G&W to acquire P&W

Topics relating to the operation of the P&W Railroad, which is a subsidiary of Genesee and Wyoming. Regional freight railroad based in Worcester and operating in Massachusetts, Rhode Island, Connecticut and New York.
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G&W to acquire P&W

Postby johnpbarlow » Mon Aug 15, 2016 7:54 am

A shocker! http://www.streetinsider.com/Corporate+News/Genesee+%26+Wyoming+(GWR)+to+Acquire+Providence+and+Worcester+Railroad+(PWX)+in+$126M+Deal/11938170.html

In the first year of operation, G&W anticipates P&W will generate approximately $35 million of revenue and $12 million of EBITDA, including realization of $8 million of immediate overhead and operational cost savings. In the medium term, G&W anticipates additional operational efficiencies and commercial opportunities will generate a further $5 million of EBITDA that will be realized over the following two to three years.

Here's link to P&W system map that shows how P&W + NECR + CSOR would fit together: http://www.pwrr.com/home/system-map/

A single route from St Albans,VT to NYC/Davisville/Worcester! Interesting...

I don't know that this is good news for P&W operations ...
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G&W to acquire P&W in $$ 126 million deal

Postby DutchRailnut » Mon Aug 15, 2016 7:55 am

If Conductors are in charge, why are they promoted to be Engineer???

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G&W to acquire P&W in $$ 126 million deal

Postby DutchRailnut » Mon Aug 15, 2016 8:37 am

If Conductors are in charge, why are they promoted to be Engineer???

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Re: G&W to acquire P&W in $$ 126 million deal

Postby chrisnewhaven » Mon Aug 15, 2016 10:33 am

Definitely good for business, but I can't help but feel a loss at their loss of independence.

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Re: G&W to acquire P&W in $$ 126 million deal

Postby MEC407 » Mon Aug 15, 2016 11:14 am

Moderator note:

So far today I've found at least four different threads in various areas of the forum, all regarding this subject. Site policy is to have one thread per subject, rather than multiple threads about the same subject scattered around different forums. If you're wondering where your thread went, it wasn't deleted; it was merged here.
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Re: G&W to acquire P&W

Postby MEC407 » Mon Aug 15, 2016 11:31 am

From GoLocalWorcester:

GoLocalWorcester wrote:“The acquisition of P&W is an excellent strategic fit with G&W’s contiguous railroads, the New England Central and the Connecticut Southern. Following anticipated STB approval of the acquisition, our connectivity with the P&W enables us to realize substantial immediate cost savings,” said Jack Hellmann, President and Chief Executive Officer of G&W. “Our acquisition of the P&W will ultimately enhance the efficiency and customer service of rail in New England.”
. . .
Upon approval by the Surface Transportation Board (STB), P&W would be managed as part of G&W’s Northeast Region, led by Senior Vice President Dave Ebbrecht. The addition of P&W to G&W’s existing presence in the region substantially enhances G&W’s ability to serve customers and Class I partners in New England, which is a highly competitive rail market with a premium placed on timely, efficient and safe rail service.


Read the rest of the article at: http://www.golocalworcester.com/busines ... ad-is-sold
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Re: G&W to acquire P&W in $$ 126 million deal

Postby Jeff Smith » Mon Aug 15, 2016 12:23 pm

I had this as global earlier to prevent the multiples. It's admittedly big news; when it's consummated I'll change the header :(

MEC407 wrote:Moderator note:

So far today I've found at least four different threads in various areas of the forum, all regarding this subject. Site policy is to have one thread per subject, rather than multiple threads about the same subject scattered around different forums. If you're wondering where your thread went, it wasn't deleted; it was merged here.
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Re: G&W to acquire P&W

Postby BandA » Mon Aug 15, 2016 12:55 pm

What do you call this thing? Market the P&W, CSOR, and NECR as the Providence, Worcester & Vermont?

The Northeast Region of G&W comprises Michigan to Maine, Quebec City to Maryland. That's a yuge footprint for Senior Vice President Dave Ebbrecht to manage!
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Re: G&W to acquire P&W

Postby TomNelligan » Mon Aug 15, 2016 2:12 pm

BandA wrote:What do you call this thing? Market the P&W, CSOR, and NECR as the Providence, Worcester & Vermont?


I don't know about marketing, but the G&W has historically kept its growing number of subsidiaries as separate corporations within the G&W family, so I suspect the P&W will continue to be the P&W even though it will turn orange and black.

Business considerations aside, I will find it sad to see such a classy regional railroad get homogenized into a big (if disconnected) national system, but I guess something of this sort was inevitable now that the original P&W management (notably Robert Eder) has reached retirement age.
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Re: G&W to acquire P&W in $$ 126 million deal

Postby MEC407 » Mon Aug 15, 2016 2:26 pm

Jeff Smith wrote:I had this as global earlier to prevent the multiples.


My bad. After I finished merging all the multiples into this thread, I changed the topic type to "sticky" and I guess that un-globaled it.

(The other issue, I think, is that a lot of people tend to breeze right past the global topics because they're accustomed to seeing stuff up there that they usually ignore, like the site TOS, etc.)
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Re: G&W to acquire P&W

Postby MEC407 » Mon Aug 15, 2016 2:30 pm

At least P&W held out long enough to prevent being RailAmericanized — although I guess the ultimate end result would've been the same.

VRS next? (Doesn't seem too far-fetched, and they seem to have had a great working relationship with P&W in recent years)
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Re: G&W to acquire P&W

Postby johnpbarlow » Mon Aug 15, 2016 2:49 pm

Anybody know anything about the Briscoe Law Firm?

PROVIDENCE AND WORCESTER RAILROAD COMPANY SHAREHOLDER ALERT: Former SEC Attorney Willie Briscoe and Powers Taylor LLP Investigate Sale to Genesee & Wyoming Inc.Former United States Securities and Exchange Commission attorney Willie Briscoe and the securities litigation firm of Powers Taylor LLP are investigating potential claims against the Board of Directors of Providence and Worcester Railroad Company (“Providence”) (PWX) concerning the sale to Genesee & Wyoming Inc. Under the terms of the agreement, Providence shareholders will only receive $25.00 for each share owned.If you are an affected investor, and you want to learn more about the investigation or if you have information that you believe would be helpful to our investigation of the fairness of the proposed transaction, contact Willie Briscoe at The Briscoe Law Firm, PLLC via email atshareholders@thebriscoelawfirm.com, Patrick Powers at Powers Taylor LLP via e-mail atshareholder@powerstaylor.com or by calling toll free at (877) 728-9607. There is no cost or fee to you.The investigation centers on whether Providence’s Board of Directors is acting in the shareholders’ best interests, whether the board considered alternatives to the acquisition, and whether the board has employed an adequate process to review and act on the proposed transaction.http://finance.yahoo.com/news/providenc ... 00473.html

A Google search of "Willie Briscoe" suggests that the Briscoe Law Firm makes a business out of investigating several publicly traded firms who have agreed to be acquired.
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Re: G&W to acquire P&W

Postby daylight4449 » Mon Aug 15, 2016 4:19 pm

Go look at the stock ticker, it's price right now is $24.56/share. Mind you that Friday it was $16.30/share. And looking back, prior to this the highest price a share caught in the last five years (using Google's tool) was $20.65/share, and it doesn't look like its ever been higher than that... So yah, some of the more vested shareholders are probably going to make out pretty good in the deal. That little announcement there reminds me of the stereotypical ambulance-chasing lawyer.

Now, other than people invoking the NECR, downsizing (as if they're the only company to do so), or saying that G&W's orange is the end of the world as we know it, can someone please give me a valid and rational explaination as to why this buyout is a bad thing?
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Re: G&W to acquire P&W

Postby chrisnewhaven » Mon Aug 15, 2016 5:02 pm

That's the thing; it's not. Looking at P&W's last few financial statements didn't have me worried, but I wasn't thrilled either. Not significantly in the red but not quite a decent profit. Largely, I feel like they suffer some of the same problems the New Haven did; too much operating territory for what is really a large terminal road. Joining with NECR and Conn. Southern increase their line haul (for some shipments) while reducing expenses, without sacrificing service. The only thing being lost is P&W's individuality.

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Re: G&W to acquire P&W

Postby F-line to Dudley via Park » Mon Aug 15, 2016 5:44 pm

chrisnewhaven wrote:That's the thing; it's not. Looking at P&W's last few financial statements didn't have me worried, but I wasn't thrilled either. Not significantly in the red but not quite a decent profit. Largely, I feel like they suffer some of the same problems the New Haven did; too much operating territory for what is really a large terminal road. Joining with NECR and Conn. Southern increase their line haul (for some shipments) while reducing expenses, without sacrificing service. The only thing being lost is P&W's individuality.

C.J.V.


CSOR is a messy fit because it's paper-barriered to the hilt by CSX for the ex-Conrail territory operatred, and by Pan Am for the ex-B&M territory operated. They can't even freely interchange with P&W at Cedar Hill and Hartford except for a narrow list of allowances. Combining P&W and NECR into one reporting mark is easy because they're unencumbered by paper barriers on the contiguous system. There's no reason for G&W not to unify them into a solidly large Class II mark. CSOR is probably going to have to remain separate unless G&W wants to shell out a humongous overpay of ransom money to break its entanglements (which CSX could still see strategic reasons to say no to). And that's probably still not worth G&W's while to pay the ransom even though they technically now control over 60% of the rail tonnage that moves through the state and nearly half the total route miles (excl. overhead rights). Have to wonder if there's going to be some additional bartering involving CSOR to square the awkwardness of the other two still being blocked from the most lucrative traffic around Greater Hartford and the I-91 corridor.
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