CN has filed an application with the U.S. Surface Transportation Board (STB) asking for control over a section of track to be transferred as a condition of approval of the Canadian Pacific-Kansas City Southern (CP-KCS) merger deal.
CN’s responsive application asks the STB to make approval of a CP-KCS merger conditional on the divestiture of the the Kansas City Speedway to CN. It is a KCS-owned line that runs from Kansas City, Missouri, to Springfield and East St. Louis, Illinois.
The STB has statutory authority to order “the divestiture of parallel tracks” as a merger condition. CN claims the CP-KCS merger has a “parallel track conflict” that reduces competition.
CN claims that granting it control of the line will provide customers with a new competitive option to move goods across a key North American economic corridor.
“Under the right ownership, we believe there is a clear opportunity to bring widespread economic benefits for customers and communities across the American Midwest and Canada. CN has a comprehensive plan for the Kansas City Speedway that will increase competition, create jobs, reduce roadway congestion, and positively impact the environment,” said Rob Reilly, CN’s executive vice-president and chief operating officer.
The railways also claims the change in ownership “reflects CN’s ongoing efforts to ensure competition and choice in our industry and aligns with President Biden’s 2021 executive order on competition.” The railway says the route would serve automotive and intermodal customers shipping between Eastern Canada, Detroit, Chicago and Kansas City.
More than 70 letters of support for the divestiture have been filed with the STB.