Canadian Pacific Kansas City and CSX work out deal for corridor linking U.S. Southeast to Mexico and Texas
Canadian Pacific Kansas City (NYSE:CP), CSX Corporation (NASDAQ:CSX), and Genesee & Wyoming announced on Wednesday they have reached agreements that when completed will create a new direct interchange connection in Alabama.
As part of a series of connected proposed transactions, Canadian Pacific Kansas City and CSX would each acquire or operate portions of Meridian & Bigbee Railroad, a G&W-owned railway in Mississippi and Alabama, to establish a new freight corridor for shippers that connects Mexico, Texas and the U.S. Southeast.
The MNBR runs between Meridian, Mississippi and Montgomery, Alabama and is currently operated under a combination of ownership and operating agreements. Under the new deal, Canadian Pacific Kansas City would acquire and operate the segment of the MNBR between Meridian and Myrtlewood, Alabama and CSX would operate the lines currently leased by MNBR east of Myrtlewood. In exchange, G&W would acquire certain Canadian properties owned by Canadian Pacific Kansas City and other rights. 
Financial terms of the various transactions were not disclosed. Certain portions of the transactions are subject to regulatory review and approval from, or exemption by, the U.S. Surface Transportation Board.
"This strategic acquisition will bring more shipping options to intermodal, automotive and other customers by providing a new, efficient corridor connecting expanding markets in Mexico, Texas and the U.S. Southeast," said Canadian Pacific Kansas City CEO Keith Creel.
"With this new east-west connection taking advantage of each railway's routes and service, we can extend our reach converting more freight traffic to rail and off our highways," he added.
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