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Blockbuster Rail Deal Faces Regulatory Slog as M&A Era Ends

  • Surface Transportation Board has discouraged consolidation
  • Powerful board likely to take more than a year to review deal
CP Rail Agrees To Buy Kansas City Southern For $25 Billion
Photographer: Alex Ramadan/Bloomberg
Updated on

Canadian Pacific Railway Ltd.’s agreement to buy Kansas City Southern faces a long journey to win regulatory approval from a powerful federal agency that approved two blockbuster mergers since it was created in 1996 and then tapped the brakes on industry consolidation.

While the Justice Department or Federal Trade Commission review mergers in other industries, railroad combinations must clear the five-person U.S. Surface Transportation Board.