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KCS to take control of TFM by week's end

After two years of deal making and breaking, and legal squabbles with Grupo TMM S.A., and more than a year of U.S. and Mexican government scrutiny, Kansas City Southern is about to take ownership of TFM S.A. de C.V.

Yesterday, KCS announced its stockholders approved a plan to issue 18 million shares of common stock to finance the railroad’s acquisition of a controlling interest in TFM – the last element needed to seal the deal. KCS officials expect to complete the purchase transaction with TMM and assume control of TFM on Friday.

TFM will continue to operate as an independent Mexican corporation under the control of holding company KCS, which also owns The Kansas City Southern Railway Co., Texas Mexican Railway Co. and Gateway Eastern Railway Co.

"With the railroads already physically linked in an end-to-end configuration, common control will enhance competition and give shippers in the NAFTA trade corridor a strong transportation alternative,” said KCS Chairman, President and Chief Executive Officer Mike Haverty in a prepared statement.

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More News from 3/30/2005