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7/7/2021
CN and Kansas City Southern yesterday made a joint submission to the Surface Transportation Board (STB) that explains why the board should approve CN’s voting trust structure, which would be a critical step toward full STB review on the merits of the proposed CN-KCS combination.
The submission closes the record on the voting trust for the CN-KCS combination, and the two Class Is now await the STB’s decision, CN and KCS officials said in a press release.
Over 1,750 letters of support have been filed with the STB, including more than 1,000 specifically requesting approval of the proposed voting trust, which is an important component of the CN-KCS combination, the companies said.
If approved by the STB, the merger would establish seamless, single-line service from Canada through the United States and into Mexico, they added.
"We are confident that our voting trust meets all the standards set forth by the STB and believe that, after a fair and thorough review by the STB, it should be approved," said CN President and Chief Executive Officer JJ Ruest.
KCS President and CEO Patrick Ottensmeyer added: "It is important that the STB approve CN's voting trust so that the STB can receive the formal merger application and proceed with a full substantive review of the many compelling and innovative pro-competitive benefits this combination will provide for the public."
The Class Is also addressed claims raised during the STB's comment period, including the following points:• The proposed voting trust agreement would protect KCS, which would maintain full independence and the ability to execute its planned capital program while in the trust.• CN and KCS would enhance competition. CN has committed to divesting the sole area of overlap between the CN and KCS networks: KCS’ 70-mile line between New Orleans and Baton Rouge, Louisiana. CN and KCS are also committed to preserving access to all major gateways on commercially reasonable terms, they said.• CN's "strong" financial profile will drive growth through investments.