Claiming that Santa Fe Southern Pacific Corp.'s...

Claiming that Santa Fe Southern Pacific Corp.'s $4.7-billion payout to shareholders still leaves them with an "undervalued stock," Henley Group said Thursday that it will continue to pursue its proxy fight to elect an alternative slate of board directors at SFSP's annual meeting, set tentatively for April 26.

Henley Chairman Michael Dingman said the plan shows that SFSP management "knows how to borrow money at high interest rates, inhibit its flexibility to restructure (and) force its shareholders to pay unnecessary taxes."

SFSP's $30-per-share payout, which is to be made Feb. 16, consists of $25 in cash and $5 in securities. SFSP is financing the payout through a corporate restructuring consisting of borrowings and the sale of assets, including the Southern Pacific Railroad.

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