Mexico’s Ferromex Ponders Merger with Ferrosur

Mexican railroad operator Ferrocarril Mexicano (Ferromex) and Ferrocarril del Sureste (Ferrosur) are contemplating a merger, Ferromex says. The talk comes a year after a Mexican judge cleared the way for the deal to take place. The companies are units of Infraestructura y Transportes de Mexico (ITM), owned by Grupo Mexico. “The negotiations with respect to the probable merger between Ferromex and Ferrosur are under very preliminary discussion among its partners,” Ferromex says. Officials at Grupo Mexico could not immediately comment, while officials at Ferromex and Ferrosur could not be reached for additional details. Grupo Mexico has been seeking to merge the 2 divisions which represent roughly 55% of Mexico’s railroad industry. The merger plans have previously encountered legal challenges along the way from Mexico’s Federal Competition Commission but a Mexican tribunal gave it a nod a year ago. The merger would unite 2 of the 3 top railroad concessions in Mexico which sprang from the country’s railroad privatization in the 1990s.