Canadian National Railway (NYSE: CNI) is reportedly preparing to sweeten its offer for Kansas City Southern (NYSE: KSU), stepping up its effort to pry the target away from merger partner Canadian Pacific Railway (NYSE: CP). In April, Canadian National launched a surprise $33 billion bid for Kansas City Southern, topping Canadian Pacific's $30 billion agreement. Kansas City Southern's board is currently reviewing the new proposal, but Canadian National isn't waiting for a decision. Image source: Kansas City Southern. The Wall Street Journal reported today that Canadian National is preparing to add to its already higher offer, potentially pledging to cover the $700 million breakup fee Kansas City Southern would owe if it abandons Canadian Pacific. Other changes were possible, with Kansas City Southern reportedly asking Canadian National to make some adjustments to its proposal. The move could be seen as an indication Canadian National believes it is close to winning its target and is hoping one last push will secure a deal, or it could be viewed as a sign that Canadian National believes its bid is not strong enough as it is. While Canadian National is offering a higher premium, it is seen as more likely to run into antitrust scrutiny due to its larger size, meaning there is added risk to going with Canadian National. Both suitors have proposed setting up a trust structure to allow Kansas City Southern shareholders to be paid prior to regulators signing off on the deal, an effort that would greatly reduce the antitrust risk. The Canadian Pacific trust has been approved by regulators, but Canadian National's proposal is still under consideration. 10 stocks we like better than Kansas City SouthernWhen investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.* David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Kansas City Southern wasn't one of them! That's right -- they think these 10 stocks are even better buys. See the 10 stocks *Stock Advisor returns as of May 11, 2021 Lou Whiteman has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Canadian National Railway. The Motley Fool has a disclosure policy.Source