KCS KCS and Mexican goverment settle all VAT and put issues!!!

Originally posted by Lowell McManus, Site Administrator at MexList:

Kansas City, MO - Kansas City Southern (KCS)(NYSE: KSU) announced that it and its subsidiaries TFM, S.A. de C.V. (TFM) and Grupo Transportación Ferroviaria Mexicana, S.A. de C.V. (GTFM), along with the Mexican holding company Grupo TMM, S.A. (Grupo TMM), have entered into a settlement agreement with the Mexican government today, resolving the controversies and disputes between the companies and the Government concerning the payment of a value added tax (VAT) refund to
TFM and the purchase of the remaining shares of TFM owned by the Mexican government. As a result of the settlement, KCS and its subsidiaries now own 100% of GTFM and TFM shares; the potential obligation of KCS, GTFM, and Grupo TMM to acquire the Mexican government's remaining 20% ownership of TFM has been eliminated; and the legal obligation of the Mexican government to issue the VAT
refund to TFM has been satisfied. Part of the value of the VAT refund was used to purchase the TFM shares and to cover taxes related to the settlement. There will be no cash payment made by any party under the settlement agreement. In addition, the parties entered into mutual releases of all existing and potential claims relating to the VAT refund and the Put obligation, and agreement to dismiss all of the existing litigation between the parties within the next three days.

"We are very pleased with the settlement announced by the Mexican government today and believe it accomplishes all of the objectives that KCS had hoped to achieve in this negotiation" said Michael R. Haverty, Chairman, President and CEO of KCS. "This settlement brings closure to this dispute. It will be good for the Mexican government, the Mexican people and for KCS' shareholders. Now we can move forward with our ongoing capital investments in TFM, and focus on providing
outstanding rail service along the NAFTA rail corridor."

With this resolution of TFM's VAT claim, KCS will be required to make a contingent payment to Grupo TMM in accordance with the terms of the December 15, 2004 Amended and Restated Acquisition Agreement (ARAA).

In accordance with the rules and regulations of the US Securities and Exchange Commission, KCS, GTFM and TFM will file a translation of the settlement agreement with a Form 8-K as a new material agreement.

Headquartered in Kansas City, MO, KCS is a transportation holding company that has railroad investments in the U.S., Mexico and Panama. Its primary U.S. holdings include The Kansas City Southern Railway Company and The Texas-Mexican Railway Company, serving the central and south central U.S. Its international holdings include TFM, S.A. de C.V., serving northeastern and central Mexico and the port cities of Lázaro Cárdenas, Tampico and Veracruz, and a 50% interest in The Panama Canal Railway Company, providing ocean-to-ocean freight and passenger service along the Panama Canal. KCS' North American rail holdings and strategic alliances are primary components of a NAFTA Railway system, linking the commercial and industrial centers of the U.S., Canada and Mexico.

 

wow, talk about a cool prototype modern railway.

Along the same line. I keep seeing trains rolling on the joint line late at night that have weird markings. To me they seem almost like a Mexican flag on them with a grey paint scheme. Could these units truly be from mexico railways?

 

Not only could they, I suspect that they're almost certainly TFM locos. They have the same grey paint scheme as KCS, but with TFM lettering and the red and green TFM Flag emblem.


Here's a shot of a KCS diseasel with the one loco they have lettered for their "NAFTA" railway. I need to look for a shot of a TFM loco, but they look the same except for the lettering.




Regards

[ September 16, 2005, 09:04 PM: Message edited by: Ed M ]

 

That's the old FNM "pitufo" paint scheme. When they sold off FNM in parts, most of the engines just got patch paint jobs with new reporting marks and logos. You'll find Ferromex and Ferrosur locos looking the same.


By the way, if you're wondering why they call it the "pitufo" paint scheme, it's because "pitufo" is the Mexican name for "smurf".

Regards

 

That's the only one. If I had known at the time I shot the photo, I would have asked the wife to stop the car so I could get a better shot.

Here's what Lowell McManus (the site administrator at MexList) told me about the unit with the "NAFTA" logo:

Shortly after KCS began its expansion into Mexico several years ago, it adopted the promotional slogan "The NAFTA Railway." The slogan was temporarily applied to KCS SD50 712 with US, Mexican, and Canadian flags, and the unit was renumbered 2000 in honor of the coming millennium. As soon as the new KCS AC4400CW's began to arrive in October 1999, they were put into the 2000 number series. The first one, number 2000, was given the NAFTA slogan and decorations. The earlier SD50 2000 was repainted into plain gray and renumbered to its original 712. KCS C4400CW 2000, which you saw, is the only current locomotive with the NAFTA slogan.