WASHINGTON — A decision appears to be at hand in the Canadian Pacific-Kansas City Southern merger.
The Surface Transportation Board has announced a Wednesday press conference at 11 a.m. EDT in which board Chairman Martin Oberman will deliver remarks “regarding the agency’s decision on the proposed acquisition” of KCS by CP, followed by a Q&A session with the media.
The event will be live streamed on the STB YouTube channel.
The announcement does not specifically say the board has reached a decision — and a number of legislators have called for the board to delay its ruling in the light of safety concerns raised by the Feb. 3 derailment and hazardous-material spill in East Palestine, Ohio. But statutory requirements make it extremely likely that a decision will, in fact, be announced.
The original statutory deadline was Jan. 19, but a decision was delayed past that date by the release of the final Environmental Impact Statement [see “Environmental review holding up …,” Trains News Wire, Jan. 19, 2023]. That document was published in the Federal Register Feb. 5, starting a 30-day clock before the board could release its final decision.
The proposed $31.6 billion CP-KCS deal would bring together the two smallest Class I railroads and create a 19,200-mile system, to be known as Canadian Pacific Kansas City, linking Canada, the U.S., and Mexico. The board accepted the railroads’ merger application in late 2021 [see “Federal regulators formally accept …,” Trains News Wire, Nov. 23, 2021].
Other Class I railroads have asked for a series of conditions to be attached to any merger approval. Most notably, Canadian National — which lost out to CP in its own bid to merge with KCS — has asked that the merged railroad be forced to sell KCS’s line connecting Springfield, Ill., to Kansas City and St. Louis, Mo., to form its own route linking Kansas City, Chicago, Detroit, and eastern Canada.
Among those who have urged the board to turn down, or at least more closely scrutinize, the merger are a group of Chicago suburbs, Chicago commuter rail operator Metra, and, most recently, U.S. Sen. Elizabeth Warren (D-Mass.), who said it was not in the public interest [see “Massachusetts senator calls on STB to reject …,” News Wire, March 6, 2023]. The U.S. Justice Department has also said it has “serious concerns” about the merger’s competitive implications [see “Justice Department chimes in, again …,” News Wire, Jan. 25, 2023].
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