Court Decides the Mexican Rail Dispute . . . or Does It?

March 29, 2004
Both companies have been operating the bi-national railroad company since 1997, but last year they went into litigation after TMM backed down from selling

Both companies have been operating the bi-national railroad company since 1997, but last year they went into litigation after TMM backed down from selling its shares to KCS although management of both companies had signed a contract to do so. KCS filed the suit, and it has won.

Yet in Mexico TMM spokesman Marco Provencio told reporters that TMM would move to second round of arbitration to fine-tune the process. Provencio says that even if a Delaware court ordered the sale, things still look complicated to TMM chairman Jose Serrano and his partner Mario Mohar, who hold voting rights for all shareholders.

"No transaction can be made without the consent of shareholders," continues Provencio, "and in that sense the panel's decision is inconclusive. We have here an on-going story and it will be a long time before it’s concluded. It's got more chapters than there are wagons in TFM's longest trains."

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