Kansas City Southern, the smallest of the major North American railroads, will be added to the Standard & Poor’s 500 Index, replacing Dean Foods Co. (DF:US) as it spins off its WhiteWave Foods Co. (WWAV:US) unit.
Shares of Kansas City Southern, based in Kansas City, Missouri, rallied 1.6 percent to $118.01 in extended trading at 5:33 p.m. New York time, adding to its 2013 gain of 39 percent. The stock will join the benchmark gauge of U.S. equity after the close of trading on May 23, S&P Dow Jones said today. Dean Foods said May 1 that WhiteWave’s shares will be offered this month.
The revision in the benchmark equity index will prompt money managers to shift holdings to match the index. More than $4.8 trillion is benchmarked to the S&P 500, according to the S&P/DJ website. With a market value of about $12.8 billion, Kansas City Southern (KSU:US) will be the 286th largest company in the index, according to data compiled by Bloomberg. The company transports goods from the Mexican port of Lazaro Cardenas to Laredo, Texas, on a line purchased from the Mexican government.
Dean Foods will replace Kansas City Southern in the S&P MidCap 400 Index, while WhiteWave Foods will take Quicksilver Resources Inc. (KWK:US)’s spot in that index.
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