• Would CN want the Tex-Mex (Texas Mexican Railroad)?

  • Discussion relating to the Canadian National, past and present. Also includes discussion of Illinois Central and Grand Trunk Western and other subsidiary roads (including Bessemer & Lake Erie and the Duluth, Missabe & Iron Range Railway). Official site: WWW.CN.CA
Discussion relating to the Canadian National, past and present. Also includes discussion of Illinois Central and Grand Trunk Western and other subsidiary roads (including Bessemer & Lake Erie and the Duluth, Missabe & Iron Range Railway). Official site: WWW.CN.CA

Moderators: Komachi, Ken V

  by texmexcoo
 
hello cn comrades lately ive been noticing that we have been running alot of kcs trains with cn cars which include grain corn syrup etc . my question is has the cn thought about or might want to purchase our line which goes from laredo to corpus to houston tx which formally was the texas mexican rail which i work for and now owned buy the un worthy kcs????we been hearing alot of rumors down in texas about the cn looking in to buying our line and getting access into mexico???????

  by Ken V
 
While CN would probably love having a direct line into Mexico, I highly doubt KCS would be willing to part with that line since it's their link between their US lines and the former TFM. CN would probably have to buy all of KCS to get it and I think UP (and BNSF) would have something to say about that.

  by bufftbone
 
I think that fight would be uglier then the one currently going on regarding the J purchase.

  by Tadman
 
No way would that happen. KCS is fully aware that their system is worth more than the sum of its parts. It would make absolutely no sense for them to sell this piece. Correct me if I'm wrong, but CNIC does not connect to Texas Mexican anyway. Also, the BNSF and UP lawyers would not make it easy either. A purchase of this nature would make Sirius/XM's merger look like a walk in the park.
  by neroden
 
If CN ever straightens out its "Chicago problem", I would be unsurprised if they aimed for a merger with KCS; it would benefit both companies without significantly reducing competition. I suspect it would clear STB approval because UP has multiple alternate routes of its own to Mexico and actually controls the KCS/Tex-Mex connection through Texas from Corpus Christi to Beaumont last I checked (with Tex-Mex and/or KCS having trackage rights I believe). BNSF is another matter but would probably just be assigned some level of trackage rights, to buy them off; they're already mostly locked out of Mexico, connecting only at El Paso.

The real problem merger was UP-SP, and that got approved....
  by kickum
 
I agree if the EJE deal ever gets done, and with CN being very pro aqusition, that KCS might be in the far off future. The CN is more of a cash cow and the KCS holds alot of debt, but maybe rebalancing that would'nt be enough to scare off CN.With a continued down spiral in the economy it might possibly provide more of a sale price. Also with a sluggish economy and CN having such a high percentage of carloading based on foresty and building materials they need more outlets. I would think that they would want to pull the trigger before Lazaro is operating at even half capacity. It would provide a great coast to coast railroad with Lazaro and Prince Rupert. The major oppostion would probably be regarding the monopoly of chemical positions in LA. The also have less of a benefit to each other both having parralel lines there which could also provide opposition from others. The CN does run alot of cars via the KCS into Mexico thru interchange at Jackson, MS. The BNSF currently has haulage rights over the KCS/Tex Mex to Laredo into Mexico and run daily trains.
  by GulfRail
 
It wants Tex-Mex, but It also wants the rest of the KCS system. Canadian National(geez, CN in Mexico? XD) knows how valuable it is, and would definitely have the cash to upgrade the line and rebuild the Wharton Sub.