Canadian Pacific, in 2007, purchased the DM&E and the IC&E railroads for $1.5 Billion. The newly purchased system needed $300 Million in track improvements and other modernization upgrades. The ability for the DM&E to enter the Power River Basin was attractive to CP in 2007, but it would come at a big cost; new track construction to the fund the PRB extension would cost several more billion plus contingency payments of another $1.05 Billion to DM&E's former owners if they so chose to build the extension. So, did CP Rail simply pay too much for the DM&E? Was the PRB unreachable due to its overall costs, the economic market of coal and, would both UP and BN undercut coal rates to make such an entry to the PRB unprofitable for years to come for CP? Should CP have held on to what became the I&M Rail Link and later the IC&E in 1997?
I newer thought that entering the PRB was a good idea, even before the CP merger. I have heard that BN lost money when C&NW got in. They would undercut the other. I felt that UP and BNSF would screw DME silly. They would have bankrupted DME really fast.
CP was involved with a hostle takeover attempt. I have heard that the DME deal was a way to make itself unattractive to takeover.