ICC Asked to Delay Rejection of Rail Merger

Santa Fe Southern Pacific Corp. said Wednesday that it will ask the Interstate Commerce Commission to delay issuing its written decision rejecting the proposed merger of Santa Fe and Southern Pacific railroads.

The railroads’ parent companies already have merged, but, in a surprise decision, the ICC voted last month to recommend against merging the two railroads. That decision would force the new Santa Fe Southern Pacific holding company to sell one railroad.

But the holding company’s chairman, John J. Schmidt, said Wednesday that the company plans to ask the federal regulatory agency to delay issuing its written decision “until we have had an opportunity to introduce new evidence on the issues before them.”

Schmidt said in a statement that the company is meeting with shippers, seeking customer support for reopening the case.

“We have also been meeting with other railroads and expect to formulate a position on how to address satisfactorily the commission’s concerns relating to the potential anti-competitive consequences of the proposed merger,” he said.

Schmidt contended that the company’s customers and competitors “do not want a flat denial of the merger.”

When the ICC voted four to one on July 24 to reject the proposed merger as anti-competitive, Schmidt said he was dismayed.

But now, he said, “with the broad public support that has materialized and our renewed effort, I have come to believe that a way can be found to address the commission’s concerns and still capitalize on the tremendous transportation efficiencies promised by the merger.”