More shippers and other stakeholders have lent their support to the proposed merger between Canadian Pacific (NYSE: CP) and Kansas City Southern (NYSE: KSU).
Forty-five customers, ports, transloading companies and others filed statements of support to the Surface Transportation Board (STB), the regulatory body that must ultimately approve CP’s acquisition of Kansas City Southern (KCS). The letters were collected and filed with the board by CP. CP estimates that 304 stakeholders have sent letters of support to STB.
“CP and KCS thank the shippers, railroads, economic development authorities, ports and other supporters that have filed letters to the STB in support of the combination,” CP said in a Tuesday release. “The CP-KCS combination is expected to provide an enhanced competitive alternative to existing rail service providers and is expected to result in improved service and efficiency to customers of all sizes. When combined, the CP-KCS network would remain the smallest of six U.S. Class I railroads by revenue.”
STB’s review of the acquisition could be completed by mid-2022, according to CP. The merger is also subject to approval from CP and KCS shareholders.
Those who submitted letters of support include the Port of New Orleans (Port NOLA), the Puerto de Lázaro Cárdenas, New Orleans Public Belt Railroad (NOPB), Columbia Forest Products, minerals producer Covia Holdings, Midstream Energy Partners and Valero Marketing and Supply, among others.
“Both Port NOLA and NOPB have benefitted from a strong relationship with KCS and have worked even more closely on growing volume moving by rail through the New Orleans corridor since the restart of intermodal service between New Orleans and Wylie in 2018,” said Brandy D. Christian, CEO for Port NOLA and NOPB. “Both Port NOLA and NOPB support approval of the CP-KCS combination. The transaction would provide significant benefits and enhanced rail network connectivity that we are eager to see realized as soon as possible.”
An English translation of a letter from Jorge Luis Cruz Ballado, director general of the Port Authority of Lázaro Cárdenas, said, “In our view, the merging of CP and KCS will provide broader services for the transportation of goods that will surely increase railway connectivity, which in turn will facilitate the transportation of heavy cargo and help decrease transportation time to the main U.S. ports on the coasts of the Gulf, the Atlantic and the Pacific. The same goes for key foreign markets, helping cargo owners transport to existing markets, as well as new markets in the most efficient way.”
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Related links:
Shippers, 4 Class I railroads press for STB scrutiny of CP-KCS merger
Nearly 260 entities lend support to proposed CP-KCS merger
Viewpoint: Greenlight the pro-shipper CP-KCS combination
Surface Transportation Board chair weighs in on proposed mergers
