THE PLANNED merger of Hong Kong’s metro operator MTR Corp and the Kowloon-Canton Railway Corp moved a step closer on June 8, when the Rail Merger Bill was approved by the region’s Legislative Council. The bill puts in place the legal framework needed to implement the merger of the state-owned KCRC and partially-privatised MTRC.
Presented to LegCo in July 2006, the bill was subjected to a detailed clause-by-clause scrutiny of issues such as the operation of the integrated network, fare structures and the regulatory framework. The merged company is to be known in Chinese as the Hong Kong Railway Co, although for international trading purposes it will continue to be known in English as MTR Corp.
No timetable has yet been set for the final consummation of the merger - the so-called ‘Appointed Day’. Still to be agreed by LegCo are the related amendments to subsidiary legislation, such as the co-ordination of the KCRC and MTRC bylaws. Once this work has been completed, an Extraordinary General Meeting of MTR Corp’s minority shareholders must be called to approve the merger transaction. In parallel, KCRC must seek consent from its bond and noteholders.
KCRC’s CEO James Blake said the unified railway ‘will be able to pursue growth opportunities inside and outside Hong Kong with our combined resources. I firmly believe we are creating a great railway in which the whole of Hong Kong can take pride.’
