Burlington Northern asks ICC to investigate Union Pacific's proposed voting trust request.FORT WORTH, Texas--(BUSINESS WIRE)--Nov. 16, 1994--Burlington Northern Inc. (BN) (NYSE NYSE See: New York Stock Exchange :BNI BNI Business Network International BNI Business Networking International BNI Bank Negara Indonesia BNI Bechtel National, Inc. BNI British Nursing Index BNI Barrow Neurological Institute (Phoenix, AZ) ) Wednesday filed a petition with the Interstate Commerce Commission Interstate Commerce Commission (ICC), former independent agency of the U.S. government, established in 1887; it was charged with regulating the economics and services of specified carriers engaged in transportation between states. (ICC ICC See: International Chamber of Commerce ) to investigate the anti-competitive effects of Union Pacific Corp.'s (NYSE:UNP Unp The symbol for the element unnilpentium. ) (UP) proposal to establish a voting trust A type of agreement by which two or more individuals who own corporate stock that carries voting rights transfer their shares to another party for voting purposes, so as to control corporate affairs. to assume effective control of Santa Fe Pacific Corp. (NYSE:SFX SFX Special Effects SFX Self Extracting (data compression) SFX SpreadFireFox (IRC) SFX Sound Effect(s) SFX Side Effects (counter-strike gaming clan) ) and Santa Fe Railway (Santa Fe). BN does not believe such a voting trust can and will insulate Santa Fe from unlawful control by UP. In asking the ICC to preserve its authority to prevent unlawful control, BN's pleading says the commission cannot permit UP to implement its proposed voting trust without full consideration of the consequences of that proposal on shippers and the public interest as well as the rail transportation system. Further, the nature of UP's proposed hostile takeover of Santa Fe, the competitive position of Santa Fe and the terms of the proposed UP voting trust "...strongly indicate that the voting trust arrangement will give UP negative control over Santa Fe for a period that could extend for five years or more," the BN pleading points out. UP has unleashed an effort to prevent a merger between BN and Santa Fe and to avoid the increased competition it would yield. By locking up in the limbo of a voting trust one of UP's major competitors, substantial doubt is raised that any voting trust could be permitted consistent with the commission's statutory mandate to protect the public interest. In addition, the proposed voting trust contains a number of provisions that would allow UP to exercise a substantial degree of control over the Santa Fe, and which would also have the effect of preventing BN from ever combining with the Santa Fe. Gerald Grinstein, BN chairman and chief executive officer, said that, "UP's behavior over the past six weeks has been inconsistent and erratic. It is, therefore, very important to maintain Santa Fe's competitive effectiveness. And an ICC voting trust won't do that." A complete copy of BN's pleading to the ICC is available upon request. CONTACT: Burlington Northern Inc., Fort Worth Richard Russack, 817/333-6116 |
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