(Kansas City Southern issued the following news release on October 8.)
KANSAS CITY, Mo. — Kansas City Southern (KCS) today stated that it accepts the decision of the Surface Transportation Board (STB) to suspend the procedural schedule involving KCS’ request to gain regulatory approval of the control of The Texas Mexican Railway Company (Tex Mex), a wholly owned subsidiary of Mexrail, Inc. (Mexrail). In its decision, the STB stated that “The board will reinstate the procedural schedule at such time as KCS demonstrates that there is a reasonable likelihood that it will be able to acquire control of Tex Mex.”
Michael R. Haverty, KCS chairman, president and chief executive officer, stated: “We accept the STB’s decision. It is a reasonable course for the STB to take given the circumstances. It is fair and equitable to KCS and all other interested parties. KCS looks forward to returning to the STB to complete the Tex Mex transaction at a future date.”
On May 9, 2003, KCS announced that it had purchased 51% of Mexrail from TFM, S.A. de C.V. (TFM) and immediately had placed the stock into an Independent Voting Trust as it sought regulatory approval to control Mexrail’s subsidiary, Tex Mex. On September 30, 2003, TFM exercised its right under the acquisition agreement to repurchase from KCS the 51% of Mexrail stock. KCS will continue to have indirect ownership of Mexrail through its 37% ownership of TFM.
KCS is a transportation holding company that has railroad investments in the United States, Mexico and Panama. Its primary holding is The Kansas City Southern Railway Company (KCSR). Headquartered in Kansas City, Missouri, KCSR serves customers in the central and south central regions of the U.S. KCS’ rail holdings and investments are primary components of a NAFTA Railway system that links the commercial and industrial centers of the United States, Canada and Mexico.