Pershing Square Issues Letter to Shareholders of Canadian Pacific

NEW YORK, May 7, 2012 /CNW/ - William A. Ackman of Pershing Square Capital Management, L.P. ("Pershing Square") today filed a letter to shareholders regarding the election of the Nominees for Management Change to the Board of Directors of Canadian Pacific Railway Limited ("Canadian Pacific") (TSX: CP; NYSE: CP), in connection with Canadian Pacific's upcoming annual general meeting of shareholders to be held on May 17th.

The full text of William A. Ackman's letter to fellow shareholders is below:

May 7, 2012

Dear Fellow Shareholder,

On May 17th, the shareholders of Canadian Pacific will have the opportunity to decide the future of this iconic railway. With your support, the Nominees for Management Change will work to recruit new leadership at CP, reverse its six-year decline, and restore the Company to its rightful position as one of the best-performing railways in North America.

We are highly incentivized to achieve this objective as Pershing Square and the Nominees for Management Change collectively own $1.8 billion of stock in the Company.

A better performing CP will deliver enormous shareholder value and substantially improve customer service, while restoring lost market share.

We have received overwhelming support and encouragement from our fellow shareholders. In a recent poll of shareholders who own 45% of the Company, Brendan Wood, an independent research firm, found that 94% of shareholders surveyed support the Nominees for Management Change. In the same poll, the incumbent board received just 6% support. This result is unsurprising as the same survey revealed that, among 46 global transportation companies, the incumbent board is ranked 41st, and Fred Green is ranked 45th.

On May 3rd, after several months of review and analysis, ISS, the leading shareholder proxy advisory firm, recommended that CP shareholders vote on the BLUE proxy FOR all seven Nominees for Management Change. Explaining its recommendation, ISS stated:

"What shareholders appear to have witnessed over these [incumbent] directors' tenure, as a close examination of the evidence in this proxy contest makes plain, is an enduring failure of board leadership, and a bewildering lack of accountability for results."

"Because the [Nominees for Management Change] have demonstrated a compelling case that poor board oversight has allowed the company's performance to drift further and further below both its peers and its potential over at least half a decade, it seems clear that change on the board is needed."

Your support is essential to effectuate the changes that are necessary to restore CP to greatness. With a strong mandate for management change from shareholders, the newly reconstituted board will hear your message loud and clear and will immediately work to identify the best new leader for Canadian Pacific.

Every vote counts. If you have not already done so, please vote the enclosed BLUE proxy or voting instruction form FOR all seven Nominees for Management Change. To send the strongest message for change, you should withhold votes from all 15 incumbent directors.

If you have already voted on management's white proxy or voting instruction form, you may still revoke that prior vote by simply voting your BLUE proxy or voting instruction form. Only your latest dated proxy will be counted. In that there are only a few days until the meeting, we encourage you to vote your shares today by Internet or by telephone. To do so, go to the website specified on the enclosed BLUE proxy or voting instruction form, or call our proxy solicitors at one of the numbers listed on the back page of this letter and they will assist you with voting. You will need your "Control Number" listed on the enclosed BLUE proxy or voting instruction form to vote by Internet or telephone.

Please also continue to visit www.CPRising.ca. There you will find copies of all of our shareholder communications and have an opportunity to submit comments directly to us.

Sincerely,

William A. Ackman

If you have not already done so, please vote the BLUE proxy or voting instruction form today. As the meeting is quickly approaching, we encourage you to vote your shares by Internet or by telephone, by following the instructions set out in the BLUE proxy or voting instruction form. Shareholders are reminded that they may still submit a BLUE proxy even if they have previously submitted a white proxy. A properly completed BLUE form of proxy or voting instruction form will automatically revoke any earlier form of proxy or voting instruction submitted by you in respect of the meeting.

Cautionary Statement Regarding Forward-Looking Statements

This press release contains forward-looking statements. All statements that are not clearly historical in nature or that necessarily depend on future events are forward-looking, and the words "anticipate," "believe," "expect," "estimate," "plan," and similar expressions are generally intended to identify forward-looking statements. These statements are based on current expectations of Pershing Square and currently available information. They are not guarantees of future performance, involve certain risks and uncertainties that are difficult to predict, and are based upon assumptions as to future events that may not prove to be accurate. Pershing Square does not assume any obligation to update any forward-looking statements contained in this press release, except as required by applicable law. Please refer to Pershing Square's proxy circular dated April 4, 2012, which is available at http://www.CPRising.ca, for further information regarding the risks of these statements.

Additional Information

To keep current with all further developments and for information about how to vote your shares and to obtain a copy of Pershing Square's proxy circular and other shareholder communications, please continue to visit http://www.CPRising.ca. If you are a shareholder and have not already done so, please vote your BLUE proxy or voting instruction form FOR all seven Nominees for Management Change, and WITHHOLD from all 15 incumbent directors or vote for up to nine incumbent management nominees. If you have any questions, need assistance in voting your BLUE proxy or voting instruction form or need a BLUE proxy or voting instruction form, please call Pershing Square's proxy solicitor in Canada, Kingsdale Shareholder Services Inc., at 1-866-851-3214 toll-free in North America, or at 1-416-867-2272 outside of North America (collect calls accepted), or Pershing Square's proxy solicitor in the United States, D.F. King & Co., Inc., at 1-800-659-5550 toll-free in North America, or at 1-212-269-5550 outside of North America (collect calls accepted). We also invite you to share your comments by going to the comment section of the CPRising website.

SOURCE Pershing Square Capital Management, L.P.

Jennifer Burner, [phone], [email protected] or Martha Durdin, [phone], [email protected]