MONTREAL — North America's largest railway may not be headquartered in Canada in the event of a merger between Canadian Pacific and Norfolk Southern, CP Rail chief executive Hunter Harrison said Thursday. The veteran American railroader told an industry conference webcast from Florida that details such as the headquarters location and distribution of board seats would have to be worked out during negotiations. Harrison and his Norfolk counterpart met last week for about two hours to discuss the Calgary-based railway's offer valued at about US$28 billion that was detailed publicly Wednesday. CP has presented a 50-50 stock-and-cash offer that would give U.S.-based Norfolk Southern shareholders US$46.72 in cash and 0.348 of a share in the new merged company for each share they hold. That would see Norfolk Southern shareholders own a 41 per cent stake in the combined company, which would be listed on both the New York and Toronto Stock Exchanges. Norfolk Southern gave a cool initial response to the takeover proposal, describing it as an "unsolicited, low-premium, non-binding, highly conditional indication of interest." Analysts have described CP Rail's offer as a "starting point." Harrison said he believes all the potential concerns of Norfolk, including price, could be resolved if the two sides sit down for intense talks. And he confirmed that the offer is not CP Rail's final "line in the sand." And he said he's not aware of any non-financial issues that could be an impediment to getting a friendly deal done and believes regulatory and shipper concerns can be addressed. While he would prefer not to launch a hostile battle, Harrison said he wants to take the proposal to shareholders. Until a deal closes, the initial structure could see the formation of a holding company headed by Harrison, with CP chief operating officer Keith Creel and Norfolk Southern CEO Jim Squires running either of the railways.