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Yesterday, Kansas City Southern announced it provided Grupo TMM S.A. $35 million in cash and stock valued at $35 million to comply with the resolution of Kansas City Southern de México S.A. de C.V.’s (KCSM) value-added tax (VAT) refund and dispute with Mexican officials over the government’s remaining ownership of KCSM (formerly TFM).
The contingent payment meets terms of a TFM acquisition agreement between KCS and Grupo TMM, and a September 2005 VAT claim settlement between KCS, Grupo TMM, KCSM and the Mexican government.
KCS also deposited $40 million into escrow a note payable to Grupo TMM. KCS will either convert the note — which might be reduced in accordance with acquisition agreement terms — into KCS shares or cash on or before April 1, 2010.
In addition, KCS paid José F. Serrano International Business S.A. de C.V. $9 million to meet terms of a consulting agreement and the TFM acquisition agreement. The consulting firm is controlled by TMM Chairman and Chief Executive Officer José Serrano.
3/14/2006
Rail News: Rail Industry Trends
KCS makes payments to Grupo TMM, consulting firm to comply with TFM agreements
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Yesterday, Kansas City Southern announced it provided Grupo TMM S.A. $35 million in cash and stock valued at $35 million to comply with the resolution of Kansas City Southern de México S.A. de C.V.’s (KCSM) value-added tax (VAT) refund and dispute with Mexican officials over the government’s remaining ownership of KCSM (formerly TFM).
The contingent payment meets terms of a TFM acquisition agreement between KCS and Grupo TMM, and a September 2005 VAT claim settlement between KCS, Grupo TMM, KCSM and the Mexican government.
KCS also deposited $40 million into escrow a note payable to Grupo TMM. KCS will either convert the note — which might be reduced in accordance with acquisition agreement terms — into KCS shares or cash on or before April 1, 2010.
In addition, KCS paid José F. Serrano International Business S.A. de C.V. $9 million to meet terms of a consulting agreement and the TFM acquisition agreement. The consulting firm is controlled by TMM Chairman and Chief Executive Officer José Serrano.
