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Canadian Pacific Says Pershing Square Continues To Make Misleading Statements

Responding to statements made by Pershing Square Capital Management, Canadian Pacific Railway Limited (CP, CP.TO) said that Pershing Square continues to make misleading statements that are not based on the facts. It is untrue and irresponsible for Pershing Square to accuse CP of manipulating its first quarter earnings.

Pershing Square is wrong in its comments about incentive compensation accruals. Accruals increased by $7 million, due in part to a higher share price. Incentive compensation accruals were higher by $4 million when compared to first quarter 2011, Canadian Pacific Railway said.

Canadian Pacific Railway noted that all accruals have been properly made and recorded in full compliance with US GAAP and have been disclosed in CP's first quarter earnings release and conference call and in the MD&A in CP's quarterly report.

In addition, on its earnings call on April 20, 2012, CP disclosed land sales in line with historical annual divestitures. This year CP recovered a $12 million insurance claim related to the significant mainline outage we experienced in 2010 due to flooding, the company said.

Pershing Square is wrong in its analysis and criticism of the DM&E transaction. The accretive acquisition of the DM&E has resulted in the addition of a great strategic asset enabling CP to expand its reach in North America. The DM&E transaction occurred when the DM&E put itself up for sale, not at a time of CP's choosing, Canadian Pacific Railway said.

by RTT Staff Writer

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