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Mexican transportation company Grupo TMM S.A. has reached an amended agreement to sell 51% of its railway unit to the Kansas City Southern Railway (KCS). In a joint press release, TMM said the two partners amended their original April 2003 acquisition agreement, which had been the cause of a legal dispute after TMM controlling shareholders rejected the deal. TMM said that under the new agreement, it will sell its 51% of its voting interest in Grupo Transportacion Ferroviaria Mexicana SA, or TFM, to KCS for $200 million in cash, 18 million shares of KCS common stock, $47 million in a two-year promissory note, and up to $110 million payable in a combination of cash and KCS common stock. The amount of the contingent payment for up to $110 million will depend on the resolution of a tax dispute between TMM and the Mexican government revolving around the privatization of Mexico's Northeast railway. The possible tax rebate was behind TMM's rejection of the original agreement and subsequent legal wrangling between the partners. The two partners have said that once the agreement is approved, they will cease all litigation. The new agreement, said industry analysts, is sure to revive KCS's plan to fold the Mexican railway into its US rail holdings under a new entity called NAFTA Rail…

Logistics services provider Target Logistics' operating subsidiary - Target Logistics Services Inc. - has been recognized by Direct Marketing Service, Inc., owner and operator of Sears Catalogues, as a top logistics partner for the second straight year. TLSI was recognized for its "excellent work through the Company's Consumer Direct Logistics (CDL) division," which provides home deliveries from its Chicago- based call center. In business for over six years, Target's CDL division has extensive experience with nationwide logistics services for retail, catalogue, and Internet direct customers. Target has a network of offices in 33 cities throughout the United States and a worldwide agent network with coverage in over 70 countries. The company is non-asset intensive and focuses on shipments over 50 pounds, with an average shipment size of 1,100 pounds; and…

Expedited air carrier UPS has said that it will take direct control of a large share of its joint venture operations in China next year. Atlanta-based UPS said it will pay $100 million to the China National Foreign Trade Transportation (Group) Corp. - better known as Sinotrans Group - to take direct control of their joint venture operations in 23 locations covering 200 Chinese cities. China has agreed to let foreign courier companies operate wholly owned international express mail businesses in the mainland from the end of next year as a condition of its membership in the World Trade Organization. Under current Chinese law, foreign air express companies are required to work with a Chinese partner. UPS has been working with state-owned Sinotrans since it entered the China market in 1988. Beginning this month, UPS will take direct control of operations in five locations: Shanghai, Guangzhou, Shenzhen, Tianjin and Qingdao. By the end of next year, it will assume control over express operations in 18 other places, it said. UPS would not identify those locations, but it said the areas covered by the agreement account for 80 percent of China's economic activity. The two companies will continue to work together in areas excluded from the agreement, UPS said. In late November, the company announced the inauguration of the first of 12 new flights to China, tripling the company's earlier services from six to 18 flights a week. It also reportedly plans to start a nonstop service between the US and Guangzhou next year and to establish a Shanghai air hub in 2007.

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