APM Terminals, the terminal operating arm of AP Moller-Maersk, has acquired the Panama Canal Railway Company (PCRC) from Canadian Pacific Kansas City Limited and U.S.-based Lanco Group/Mi‑Jack.

The acquisition of the Panama Canal's critical rail link to the unit of Denmark's Maersk, one of the world's largest shipping groups, comes amid renewed attention on the Panama Canal region amid escalating trade tensions between the US and some of its major trading partners.

While Canadian rail company CPKC did not disclose the terms of the sale, it said that the agreement with APM Terminals will help it focus on its core assets in Canada, the U.S., and Mexico. 

For APM, it would significantly expand its intermodal capabilities in Central America.

PCRC operates a 76-km (47-mile) single-line railway adjacent to the Panama Canal that mainly facilitates cargo movement between the Atlantic and Pacific Oceans.

In 2024, the PCRC generated revenue of US$77 million and earnings before interest, taxes, depreciation, and amortisation (EBITDA) of US$36 million.

"The Panama Canal Railway Company represents an attractive infrastructure investment in the region aligned to our core services of intermodal container movement," said Keith Svendsen, CEO, APM Terminals.

"The company is highly regarded for its operational excellence and will provide a significant opportunity for us to offer a broader range of services to the global shipping customers we serve," he added.

Keith Creel, CPKC president and chief executive officer, described the deal as a sale of a "non-core asset" of CPKC, which, just in 2023, merged with Kansas City Southern (KCS), creating the only railroad connecting the U.S., Canada, and Mexico on a single line network.

"We are pleased to have completed this transaction with APM Terminals, a part of A.P. Moller - Maersk, a key strategic partner of CPKC's and major customer of the Panama Canal Railway Company," Creel said.

"The sale of this non-core asset creates value for our shareholders and reflects our commitment to optimize our assets as we focus on growing our core North American rail business through our unrivalled three-nation network connecting Canada, the United States and Mexico," the CPKC chief added.