The Surface Transportation Board is blocking Canadian National Railway’s current bid to purchase Kansas City Southern. STB feels the current deal, which includes a voting trust, would violate the regulations.
“The proposed use of a voting trust in the context of the impending control application does not meet the standards under the current merger regulations. [The agency] therefore denies the applicants’ motion for authorization to establish and use the proposed voting trust.” says STB.
Canadian National and Canadian Pacific have been trying to purchase Kansas City Southern for several months. Both railroads hope to build the first continental rail network between the United States, Mexico, and Canada.
U.S. rail regulator rejects CN’s voting trust bid to buy Kansas City Southern
Bill Stephens, a columnist with trains.com, used his latest article to break down the 33-page explanation from STB. His article, Analysis: With CN-KCS decision, regulators shut the door to future mergers, discusses why “the board explained why we’ll never see a transcontinental merger under the current review rules.”
