WASHINGTON — The chairman of the House Committee on Transportation and Infrastruture has voiced his opposition to a voting trust while regulators consider the proposed merger of Canadian National and Kansas City Southern.
Rep. Peter DeFazio (D-Ore.) said in a Monday letter to the Surface Transportation Board that the trust would “reduce competition and prejudice the outcome of the Surface Transportation Board’s merger proceeding.” Saying that approximately 300 current customers overlap between the two rail networks, DeFazio contends “a single holding company responsible for this traffic would likely change rail traffic patterns in the significant areas of parallel service overlap” and that the merger “will exacerbate U.S. job losses from cross-border trade agreements that prioritize profits over people and inflict harm on worker’s rights, consumer safety, and the environment.”
In his role as committee chairman, DeFazio had previously been critical of the efforts by both CN and Canadian Pacific to acquire KCS. In an April statement, DeFazio said the railroads’ pursuit of KCS “should set off alarm bells about a potential new wave of railroad mergers that stifle competition and trigger industry-wide consolidation.
CP, which is continuing to pursue its efforts to acquire KCS in the event the CN-KCS deal is turned down, quickly sent out its own press release quoting DeFazio’s letter in full, and contending its merger with KCS would enhance competition and “raise none of the anti-competitive concerns by hundreds of shippers and other stakeholders.”
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