CSX Acquisition of Pan Am Railways

Shortline614 wrote: ↑Wed Mar 24, 2021 11:53 am The only group with any legitimize issue are the ones arguing for competition over the Conn River Line (VRS and VTrans). All the others just want to use this transaction as a way to force though unrelated side projects.

I think the supplemental response by the Massachusetts DOT/MBTA raises some valid points as well - especially with regard to contradictions between the various filings from CSX, NS. and G&W with regard to exactly how the "operation" of Pan Am Southern by B&E is supposed to work.

There's a lot here for the STB to sort through - I suspect this may get bumped up from the "minor" transaction that CSX was hoping for, but we'll see.

I thought the proposed operations of PAS/B&E were fairly cut and dry from a regulatory perspective. They don't need to know who pays for every spike.

I also think this is going to be classed as a major application.

Douglasphil wrote: ↑Wed Mar 24, 2021 6:25 pm All the talk regarding maintaining competition in the rail industry is a bit over blown . First off the railroads have a market share of about 7% nationally and I'll bet a lot less here in New England. The real competition is the trucking industry. Secondly the fact of Connecticut bring served by G&W exclusively is not a big deal. That state was the private playground of the New Haven for years. And that was when the state was a giant in the machine and metal working industry.

28-40% (depending on measuring factors).

newpylong wrote: ↑Wed Mar 24, 2021 6:46 pm I thought the proposed operations of PAS/B&E were fairly cut and dry from a regulatory perspective. They don't need to know who pays for every spike.

I also think this is going to be classed as a major application.

It's not the "who pays for" that's in question. It's "who sets the pricing and determines the level of service" that has contradictory answers. It's a matter of how much B&E will be independent from G&W if it's the G&W marketing department that's making those determinations.

Significant it is.... all this for one squeaky wheel who hasn't figured out how to change their own pee-pants.

https://public-inspection.federalregist ... -06211.pdf

If I were CSX I might be close to the "thanks but no thanks" point by now, especially after the Massena line debacle.

Thank NS for insisting on the GWI to operate PAS. Anyone else this is a slam dunk. Maybe that's why they did it, they're perfectly happy doing nothing right now.

Unless I’m mistaken, Republic was the only shipper that filed a complaint or concern? I find it absolutely fascinating if the competitive issues were that severe that only one shipper would complain against the couple dozen who wrote letters of support. Even still, how many VRS shippers chimed in?

There’s a new order in Washington since Inauguration Day and it is one in favour of heavy handed regulation across the board. Didn’t all those members of Congress from New England come out in favour of significant? I have to believe that had an impact on the regulators. Regulators ignore congress at their peril, especially members of the majority party.

The ‘significant’ ruling could easily push the transaction into 2023 or beyond if there are still objections. That may be too long for TM to wait and CSXT may decide to put their energies to more productive uses. If that is the case, we could see the balkanization of the northern New England rail system. Do we end up of a bunch of Class III and Short Lines owning individual pieces of PAR? Will PAR file for abandonment of the Bucksport and Hillsboro branches? It is a given NS will not be running DS on a faster route to Ayer over CSX so the fillet and toupee will continue. The STB may have squashed the hopes of any true truck/rail competition east of Ayer. What was a plan to move an empty pocketed railroad into the hands of a rail company that spent over $1.2B on MoW the last three years could now end up in the paper shredder.

I don't see it going beyond 2022. It's likely the applicants while not happy, saw this coming and are prepared to not only modify the schedule promptly but provide the delta data going from Minor to Major transaction.

If CSX eventually gives up, Mellon will likely just attempt selling to the next bidder as a whole. No reason to break it up as part of the sale, the value will be greatly diminished.

This should be an easy remedy, given there really is a narrow focus on the entities that have issues here. Unless more people come out of the wood work, the solutions should be easy but the process simply will take more time as a matter of formality.

Lest we not forget, the Board will have something to keep them quite preoccupied for the next several years - KCS-CP.

That could easily get CSX-PAR classified as "minor" simply to be rid of it.

Mr. Norman. it's been classified as "Significant".

That doesn't surprise me.

There are five rail routes that connect New England with the rest of the US: the NEC, the Maybrook Line, the B&A, the Hoosac Tunnel route (in which I'd include the VTR interchange at Hoosick Jct.) and the ex-D&H branch from Whitehall NY to Rutland VT. Every other linkage to the rest of the North American rail network goes through Canada. Only 2 of those 5 are really viable from a freight perspective-- the NEC dead-ends in Brooklyn for freight; the Maybrook is dead, period; and the route through Whitehall is totally roundabout for traffic from anywhere but northern Vermont. This deal would effectively put both of those routes-- providing rail freight access to six states with a combined population of 14 million-- under common ownership.

Ridgefielder wrote: ↑Thu Mar 25, 2021 9:24 am This deal . . . providing rail freight access to six states with a combined population of 14 million-- under common ownership.

I really have mixed feelings about this. Can't something be said for a truly unified "New England Railroad" that offers seamless service throughout the region? We pretty much have had a hodgepodge of disjointed, small, some cash-strapped and barely surviving, railroad operators here and now we have an opportunity for a major Class I and a well-established major "Shortline" offering potentially the best level of rail service ever in our lifetime. It's not like we have a ton of thriving industries here looking for competitive rail service. I think this is all good. Let's give VRS some trackage rights and seal this deal.