northamericantradebarrels.docVIP

North American Trade Barrels Through Railroads Limitations By ANNA WILDE MATHEWS Staff Reporter of THE WALL STREET JOURNAL Lured by the increasingly lucrative trade between Canada, the U.S. and Mexico, railroads are shifting gears to create a network of routes among the countries. The clearest sign of that trend came just Tuesday as Canadian National Railway Co., as expected, announced agreement on an ambitious $2.4 billion deal to buy Illinois Central Corp., plus the assumption of $560 million in debt. Revenue of $3.7 Billion The new railroad will be part of a three-way battle to handle goods traveling by rail among the U.S., Mexico and Canada, a market that already totals more than $70 billion worth of goods and that is expected to keep growing under the North American Free Trade Agreement. Its rivals for that business to the south are Kansas City Southern Industries Inc. and Union Pacific Corp. Kansas City Southern two years ago launched the fight for stronger rail links in Mexico with a surprisingly large, $1.4 billion bid for Mexicos busiest rail line, which it is spending millions to repair. Giant Union Pacific, with the biggest U.S. rail network, followed by buying its own share of a Mexican line, the less developed Pacific-North concession. A Trump Card But Canadian National and Illinois Central may have a trump card: The new company could become the first with track in all three countries. Illinois Central has joined with two Mexican companies, closely held mining and steel conglomerate Grupo Acerero del Norte SA