KANSAS CITY &lt;KSU> READY TO BUY SOUTHERN PACIFIC

  Kansas City Southern Industries Inc
  said it is ready to promptly purchase the Southern Pacific
  Transportation Co from Santa Fe Southern Pacific Corp &lt;SFX> if
  the Interstate Commerce Commission rejects Sante Fe's attempt
  to reopen the merger of Southern and the Atchison, Tokepa and
  Santa Fe Railway.
      In a filing with the ICC late today, the company outlined
  four conditions of its offer to acquire Southern Pacific.
      Among the conditions are that Santa Fe enter into an
  agreement to indemnify Kansas City for any contigent liabilites
  of Southern Pacific existing as of the closing date, and that
  the financial condition of Southern remain largely unchanged
  from today onward.
      "We are willing, even eager, to make a fair market value
  offer in cash for the Southern Pacific," said Kansas City
  Southern president and chief executive officer Landon H.
  Rowland.
      "This offer disproves the constant derogation of the
  Sourthern Pacific by SFSP management, best exemplified by SFSP
  Chief Executive John Schmidt's comment in ICC hearings that the
  Southern Pacific was 'bankrupt,'" said Rowland.
      He said that merging Southern with Kansas City will achieve
  the benefits of an end-to-end merger while preseving the
  independece of the Southern Pacific versus its existing prime
  competitor, Santa Fe.
      Kansas said that Southern's management had estimated the
  value of the railroad in 1983 in the range of 281 mln dlrs to
  1.2 billion dlrs.
      It said that Morgan Stanley and Co Inc and Salomon Brothers
  Inc, hired in 1983 to advise Southern and Santa Fe in their
  merger, appraised Southern as worth between 500 mln dlrs and
  800 mln dlrs less than Southern's own internal valuations.
      Kanasa City Southern said it will make an offer for
  Southern after its books, records and properties are examined.
      "Once that examination has been completed (and even in the
  absence of a willingnes of SFSP to negotiate) KCSI will make an
  offer in writing...." said the company.
      Kansas also said it argued in the ICC filing that Santa Fe
  had not met the legal requirements justifying the Commission's
  reconsideration of the proposed merger of Santa Fe and Southern
  Pacific, two railroads that it said basically parallel each
  other throughout their routes.
      ICC voted four to one last summer to reject the merger as
  inherently anticompetitive. Kansas said Santa Fe in petitioning
  for reconsideration now argues that the trackage agreements
  with the Union Pacific, the Denver and Rio Grande Western and
  other railroads, adds to the value of the merger.
  

