Canadian Pacific Railway Ltd. announced yesterday the completion of its $31 billion acquisition of Kansas City Southern, one of the largest transporters of base oil and lubricants from the United States into Mexico. The companies’ joint railroad control application with the U.S. Surface Transportation Board still awaits a decision, which is expected late next year.
The Canadian Pacific railroad system extends across Canada and the Upper Midwest in the United States. Kansas City Southern’s network runs through the southeast United States and Mexico. The two systems will connect in Kansas City, Missouri, where they already interchange and operate a shared facility.
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Canadian Pacific said that immediately upon the acquisition’s closing, KSC’s shares were placed into a voting trust with Dave Starling, former KSC president and CEO, appointed as voting trustee. The voting trust, which ensures KSC will operate independently of Canadian Pacific, will remain in effect until the U.S. Surface Transportation Board issues its decision on the companies’ joint railroad control application. The board’s approval of Canadian Pacific’s control of KCS would create Canadian Pacific Kansas City Ltd., the only single-line railroad linking the United States, Mexico and Canada. The STB review of the matter is expected to be completed in the fourth quarter of 2022.