(The following article by Randolph Heaster was posted on the Kansas City Star website on September 5.)
KANSAS CITY — Grupo TMM said Thursday that it will “vigorously defend” itself against a lawsuit brought by Kansas City Southern.
Earlier this week in a Delaware state court, Kansas City Southern filed for a preliminary injunction against TMM. The injunction seeks to preserve the status quo while Kansas City Southern and TMM try to settle a dispute over the sale of Mexico’s biggest railroad.
Kansas City Southern and TMM jointly operate Grupo TFM, which is in northeast Mexico. In April, Kansas City Southern agreed to acquire control of TFM as part of a plan to create a 6,000-mile rail line between Chicago and Mexico City, to be called NAFTA Rail.
That agreement was rejected by TMM’s controlling shareholders last month, touching off the fight between the two companies. Kansas City Southern has maintained that the original purchase agreement remains valid, while TMM has contended that the sale is now terminated.
Along with its court action, Kansas City Southern has exercised a provision in the purchase agreement that could lead to an arbitration hearing on the dispute.
TMM said it believes Kansas City Southern’s lawsuit is without merit.
In a statement Thursday, the Mexican transportation company said it “remains confident that once all of the facts have been presented, Grupo TMM will prevail both in defeating KCS’ motion for an injunction and in any arbitration of this dispute.”