By Nick Carey
CHICAGO, Jan 8 (Reuters) - Two trade unions representing
workers at No. 4 U.S. railroad Norfolk Southern Corp (N:NSC) NSC.N
have joined a growing chorus of opposition to an unsolicited bid
from Canadian Pacific Railway Ltd CP.TO , one in an unpublished
letter sent to the U.S. rail regulator and the other in an
interview with Reuters.
The moves add to a growing list of opponents to any deal,
which includes customers of Norfolk Southern and a number of
elected U.S. officials.
In a Jan. 7 letter to the Surface Transportation Board that
has not yet been made public but was viewed by Reuters,
Transportation Communications Union/International Association of
Machinists President Robert Scardelletti urged the rejection of
any proposed merger.
"CP's proposed merger would result in massive job reductions
of United States rail workers," Scardelletti wrote. "If such a
merger is approved, it undoubtedly would lead to further
consolidation of the remaining U.S. carriers, with attendant job
loss throughout every railroad craft."
The TCU/IAM letter comes a few days after Reuters reported
on a series of letters from Norfolk Southern customers to the
STB opposing any merger.
Norfolk Southern declined to comment and Canadian Pacific
could not immediately be reached.
The Canadian company in mid-November disclosed its $28
billion offer to buy Norfolk Southern.
Opponents' main concerns are that any deal could trigger a
wave of mergers that would leave North America with an
anticompetitive rail duopoly and that Canadian Pacific would
squeeze profit out of Norfolk Southern by cutting back on
necessary investments.
It would be the first merger involving a U.S. railroad since
the STB rewrote rules in 2001 after a flurry of consolidation
reduced the number of major North American railroads to seven
from 35.
The proposed merger could face a tough review, and the
regulator is expected to give customers and trade unions even
more time than in the past to air concerns at public hearings.
A number of elected officials have also come out against any
deal.
Separately, John Risch, the national legislative director
for the transportation division of the SMART Union, said his
labor organization was "very concerned" that Canadian Pacific
would strip Norfolk Southern of workers and necessary
investments.
"You don't merge two railroads like this to create job
opportunities but to boost profits for a few investors," he told
Reuters in an interview.
Risch said SMART "will very likely" voice concerns directly
to the STB in the near future.
(Editing by Matthew Lewis)