Kansas City Southern jumped as much as 23 percent as Canadian National Railway Co. offered $30 billion to snatch the U.S. railroad away from a rival, raising the prospect of a bidding war.

Canadian National Railway Co. (CN) trains pass through the Macmillan Yard in Toronto, Ontario, Canada, on Tuesday, Oct. 18, 2011. Photographer: Brent Lewin/Bloomberg

The $325-a-share bid consists of $200 in cash and 1.059 Canadian National shares for each share of Kansas City Southern, the Montreal-based railroad said in a statement Tuesday. Canadian National said its offer has an enterprise value of $33.7 billion.

The bid is 20 percent higher than a $25 billion deal that Kansas City Southern made with Canadian Pacific Railway Ltd. last month.

At stake is control of a rail network that links the U.S., Mexico and Canada in the first year of a trade alliance between the three countries. Kansas City Southern’s sprawling Midwestern system connects farms in Kansas and Missouri to ports along the Gulf of Mexico. Its network also reaches deep into Mexico, which made up almost half of the Kansas City, Missouri-based rail operator’s revenue last year.

Kansas City Southern climbed 18 percent to $303 before the start of regular trading Tuesday in New York after surging to as high as $316.49. The stock had advanced 26 percent this year through Monday, while the S&P 500 Industrials Index rose 14 percent.