[Federal Register Volume 65, Number 16 (Tuesday, January 25, 2000)]
[Notices]
[Page 4016]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-1648]


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DEPARTMENT OF TRANSPORTATION

Surface Transportation Board

[STB Finance Docket No. 33844]


Kansas City Southern Industries, Inc., et al.--Corporate Family 
Transaction Exemption

    Kansas City Southern Industries, Inc. (KCSI), Kansas City Southern 
Lines, Inc. (KCSL), The Kansas City Southern Railway Company (KCSR), 
KCS Transportation Company (KCST), Gateway Western Railway Company 
(GWWR), and Gateway Eastern Railway Company (GWER) (collectively, 
applicants),\1\ have filed a verified notice of exemption. The exempt 
transaction involves KCSR's acquisition of KCST's rail subsidiaries, 
GWWR and GWER, through acquiring KCST's stock from KCSL.
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    \1\ KCSI is a publicly traded, noncarrier holding company with 
both rail and nonrail assets. KCSL, a noncarrier holding company 
which owns direct and indirect interests in rail transportation 
companies, is a direct wholly owned subsidiary of KCSI. KCSR, a 
Class I rail carrier operating in the States of Nebraska, Iowa, 
Kansas, Missouri, Oklahoma, Arkansas, Texas, Louisiana, Mississippi, 
Tennessee, and Alabama, is a wholly owned subsidiary of KCSL and an 
indirect wholly owned subsidiary of KCSI. KCST, a noncarrier, is a 
wholly owned subsidiary of KCSL and an indirect wholly owned 
subsidiary of KCSI. KCST owns all of the stock of GWWR, a Class II 
rail carrier operating in the States of Kansas, Missouri and 
Illinois. GWWR owns all of the stock of GWER, a Class III rail 
carrier operating in the State of Illinois.
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    The applicants reported that they intended to consummate the 
transaction immediately upon the effective date of the exemption. The 
earliest the transaction could be consummated was January 17, 2000, 7 
days after the exemption was filed.\2\
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    \2\ Upon completion of the transaction, KCSR will indirectly 
control GWWR and GWER.
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    The purpose of the transaction is to facilitate the planned spinoff 
of KCSI's financial subsidiaries into a corporation separate from KCSI, 
and to bring all of KCSI's commonly controlled railroads under the 
direct control of KCSR.
    This is a transaction within a corporate family of the type 
specifically exempted from prior review and approval under 49 CFR 
1180.2(d)(3). The applicants state that the transaction will not result 
in adverse changes in service levels, significant operational changes, 
or a change in the competitive balance with carriers outside the 
corporate family.
    Under 49 U.S.C. 10502(g), the Board may not use its exemption 
authority to relieve a rail carrier of its statutory obligation to 
protect the interests of its employees. Although applicants do not 
expect any employees to be adversely affected by this control 
transaction, they have agreed to apply employee protective conditions 
pursuant to 49 U.S.C. 11326(a). Therefore, any employees adversely 
affected by the control transaction will be protected by the conditions 
set forth in New York Dock Ry.--Control--Brooklyn Eastern Dist., 360 
I.C.C. 60 (1979).
    If the verified notice contains false or misleading information, 
the exemption is void ab initio. Petitions to reopen the proceeding to 
revoke the exemption under 49 U.S.C. 10502(d) may be filed at any time. 
The filing of a petition to reopen will not automatically stay the 
transaction.
    An original and 10 copies of all pleadings, referring to STB 
Finance Docket No. 33844, must be filed with the Surface Transportation 
Board, Office of the Secretary, Case Control Unit, 1925 K Street, N.W., 
Washington, DC 20423-0001. In addition, a copy of each pleading must be 
served on William A. Mullins, Esq., Troutman Sanders, LLP, 1300 I 
Street, N.W., Suite 500 East, Washington, DC 20005-3314.
    Board decisions and notices are available on our website at 
``WWW.STB.DOT.GOV.''

    Decided: January 18, 2000.

     By the Board, David M. Konschnik, Director, Office of 
Proceedings.
Vernon A. Williams,
Secretary.
[FR Doc. 00-1648 Filed 1-24-00; 8:45 am]
BILLING CODE 4915-00-P