The Interstate Commerce Commission today unanimously approved the sale of the Southern Pacific Railroad to Rio Grande Industries, creating a 15,000-mile rail system that covers 15 states from Portland, Ore., to New Orleans. Rio Grande Industries has agreed to buy the Southern Pacific from Santa Fe Southern Pacific Corp. for $1.2 billion. The ICC in a 4-0 vote said the merger of the Southern Pacific and the Denver & Rio Grande Western railroads would have the best competitive results and be in the public interest. The commission last year ordered the Santa Fe Southern Pacific Corp. to divest itself of the Southern Pacific after the rejection of that railroad's merger with the Santa Fe. Santa Fe Southern reached agreement with Rio Grande Industries, but when permission for the sale was sought from the ICC, another railroad company, Kansas City Southern Industries, objected and sought to buy Southern Pacific as well. But the ICC in a series of votes today turned its back on the Kansas City Southern proposal and approved the sale to Rio Grande Industries instead. At a news conference, Philip Anschutz, chairman of Rio Grande Industries, applauded the ICC decision and said the combined railroads ``will operate under the banner of Southern Pacific.'' He said that senior officers of the Southern Pacific will be announced before the purchase is completed and that managers will be drawn from the ranks of both railroads. The Southern Pacific also has extensive real estate holdings in the West, but Anschutz said, ``We will be in the railroad business, first and foremost.'' The Southern Pacific operates up and down the West Coast and along the southern tier of the country with tracks stretching from Portland, Ore., through central California through El Paso, Texas, and as far east as New Orleans. It also operates from St. Louis to the Gulf Coast. The Denver & Rio Grande runs along a central corridor from Ogden, Utah, to St. Louis. Kansas City Southern could challenge the ICC ruling in court but the company's president and chief executive officer, Landon Rowland, said no decision has been made on what the next step, if any, would be. ``We're not ruling out anything. ... I don't know what our options are,'' Rowland told reporters after the ICC vote.