(Kansas City Southern issued the following news release on January 6.)
KANSAS CITY, Mo. — Kansas City Southern (KCS) issued the following statement in response to today’s ruling by the Delaware Court of Chancery regarding a motion to enforce injunction and hold Grupo TMM, S.A. (TMM) in contempt in the dispute between KCS and TMM over the Acquisition Agreement:
“The Delaware Court of Chancery held TMM in contempt of court for taking action inconsistent with its October 29, 2003, order that TMM abide by the terms and conditions of the Acquisition Agreement pending arbitration of the parties’ dispute over the Agreement. The court held that by TMM causing its subsidiary Grupo TFM (GTFM) to revoke powers of attorney requiring the signature of a KCS representative for transactions in excess of $2.5 million and in granting new powers of attorney to TMM directors Jose Serrano and Mario Mohar to act on behalf of the company, TMM violated provisions of the Acquisition Agreement. The previous order of the court required TMM to cause GTFM to conduct its business in accordance with past practices and not to directly or indirectly amend its organizational documents. The court ordered TMM to take the actions necessary to revoke the new powers of attorney, to re-enact the original powers of attorney, and to pay KCS its costs and attorney fees for bringing this motion for contempt. KCS believes the Delaware Court’s decision is appropriate and upholds KCS’s belief that TMM cannot arbitrarily take actions without KCS’s concurrence.”
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.