Canadian Pacific (CP) has announced that it will split its business empire into five publicly traded companies in the fall. Four of its subsidiaries will become separate public companies as follows:

• Canadian Pacific Railway—with operations in Canada and the Northeastern United States;
• CP Ships—the seventh-largest container operator in the world, which owns Canada Maritime, Cast North America, Contship Container Lines, Lykes Lines, TMM, and Australia-New Zealand Direct Line;
• PanCanadian Petroleum—a producer of crude oil, natural gas, and natural gas liquids; and
• Fording—a producer of metallurgical coal and other minerals.

Canadian Pacific Hotels will be the only significant business retained directly by Canadian Pacific.

At a press conference, Chairman, President, and Chief Executive Officer David P. O'Brien cited each subsidiary's growth in revenues and net income as evidence that they were ready for independent lives. "These companies," he said, "really are little jewels waiting to be discovered by investors."

But while he was painting that glowing picture, Standard & Poor's was putting CP Ships on "credit watch." S&P noted that CP Ships would be losing access to its parent company's capital and questioned whether the relationship between CP Railway and CP Ships would remain as mutually beneficial as it has been under the aegis of their parent.

The plan is subject to shareholder and court approval and a favorable tax ruling by Canadian authorities.