CSX Acquisition of Pan Am Railways

The CRSA solution is the obvious one from an outside observer’s perspective. Given the rumors that pan am southern is the sticking point, there must be a compelling business reason why at least one of the parties is apparently rejecting that solution. As noted before, the nysw is basically CRSA-lite as far as I can tell

Would Delaware Oswego,,the owner of NYSW be able to pull it off,and will the StB go for that option?

Last I heard a couple years back both csx and NS had large, equal stakes in nysw. If that is still true and csx and NS wanted nysw to operate pas, I am pretty sure they would provide nysw with the capital to do so

Between NS/CSX creating a new CRSA region would not be a deal breaker.

NS also has experience working with NYSW as an operator of their trains. Most of the Southern Tier was sold to NYSW (under the "Central New York" name) several years ago, and they've (NYSW/CNY) been the operator of that section of line ever since, even though the trains look like NS ones. That might be a reason NS would prefer NYSW in this case, too.

F74265A wrote: ↑Tue Feb 09, 2021 11:09 pm The CRSA solution is the obvious one from an outside observer’s perspective. Given the rumors that pan am southern is the sticking point, there must be a compelling business reason why at least one of the parties is apparently rejecting that solution. As noted before, the nysw is basically CRSA-lite as far as I can tell

I agree: CRSA is the “obvious” answer to such an extent that there must be some reason why it’s apparently not in the mix. Two possibilities come to my mind (put these in the “thinking out loud” category):

1. CRSA is not a 50-50 venture; I think it is 58-42 (mirroring the split of Conrail overall - and I think CSX is the 58). PAS is 50-50. NS will want any profits from PAS - including any profits earned by the contract operator - to be split 50-50; CRSA is a bad fit on that basis.

2. CRSA, despite not being 50-50, I would have to assume is operated in a fairly “neutral” manner - neither party having a controlling / veto-ing interest. As discussed above, PAS is not like that: once Pan Am sells out of their portion, NS apparently gains the controlling hand. (But surely NYSW is operated more like CRSA in this regard, so I would discount this as a possible explanation.)

I think point 1 above is the more salient one, and that the 50-50 nature of NYSW might actually make it a more natural fit than CRSA to operate PAS. (This might also explain why NS and CSX never folded NYSW into CRSA in the past - which, on its face, might be an equally obvious step to take?)

(Apologies in advance if I have any of my facts wrong - corrections welcome!)

Mr. Moldover, what I'm at a loss to understand is that if SusieQ owns both the ERIE and the D&H South of Albany, why isn't she trumpeting that at her website?

http://www.nysw.com/

OK; Mr. Athol's photo, along with Mr. Barlow's explanation, established for me that tri-levels can operate through Hoosac. However, to chop more off the concrete lining needed for "double stacks", that I guess had been there since the B&M bored it with room, plus catenary, for anything running 100 years ago, would jeopardize the tunnel's structural integrity even more. Something along the lines of what Topper's predecessor, the SRY, did with their Cinci-Atlanta line, the Rathole, some 50 years ago would be needed.

Where in heaven's name would SusieQ come up with the capital to make PAS competitive with the B&A? With the reports here that it is Class 2 West of where the "T" has paid for Class 4 (and NNEPRA for same to Portland), there need be a stronger "benefactor" in place than Susie.

Now so far as getting the Maine Central up from its Class 2, and even Class 1 in some places, I would think such would require capital from both Chessie and Topper. I think a Shared Assets arrangement (Conrail "might or might not" be the operator) for everything East of Ayer or Worcester is the only way to have rail service in Maine so that the Port agencies - Portland, Searsport, and Saint John - can approach the maritime companies to "call at us" with your high value Containers and Bennies.

NYSW only owns East of Binghamton (as noted in their map). NS owns the D&H and the Tier (Erie) west of Bing.

The NYSW would not need to be competitive with the B&A. NS is perfectly happy with the current service that they can provide to Ayer and captive interchange partners and customers on PAS. With CSX owning the other half, there is even less of a need to overlap the service lanes.

Topper has and will have nothing to do with the the MEC post sale.

Nysw has nothing to do with any former d&h lines presently. Years ago they operated d&h in bankruptcy I recall

My understanding is that neither NS nor csx want nysw in its current form in New York impinging on their own business so I think it is intentional by csx and NS that nysw remains a backwater operation for now

If nysw were to operate pas, whatever capital it was deemed to need by NS and csx would have to come from them.

NYSW operating PAS is a very interesting prospect. The NYSW is basically a "feeder" railroad that sends carload traffic to CSX and Norfolk Southern. It also opens up another interesting possibility. Say in the future "X" railroad goes up for sale. CSX and Norfolk Southern could buy "X" railroad and fold it into the NYS&W, ensuring that its traffic ends up in the hands of the two eastern Class Is.

I also think that CSX would take units out of storage, send them to Pan Am territory, and then sell Pan Am's power to NY&SW.

Gilbert B Norman wrote: ↑Wed Feb 10, 2021 10:02 am Mr. Moldover, what I'm at a loss to understand is that if SusieQ owns both the ERIE and the D&H South of Albany, why isn't she trumpeting that at her website?
(Central
http://www.nysw.com/

She doesn't own the D&H south of Albany - just the Erie - and it's via a subsidiary (Central New York Railroad).

Doesn’t CNY lease the tier east of Binghamton from NS? I don’t recall hearing they bought it

From the CSX 2020 10_K Annual report:

Acquisition of Pan-Am Railways
On November 30, 2020, CSX signed a definitive agreement to acquire Pan Am Railways, Inc. (“Pan Am”) which owns and operates a highly integrated, nearly 1,200-mile rail network and has a partial interest in the more than 600-mile Pan Am Southern system. This will expand CSX’s reach in Connecticut, New York and Massachusetts while adding Vermont, New Hampshire and Maine to its existing network. A $30 million deposit paid by the Company related to its agreement to acquire Pan Am is included in other investing activities on the consolidated cash flow statement. This transaction remains subject to regulatory review and approval by the Surface Transportation Board.

https://seekingalpha.com/filing/5357243 ... ent=link-0

Re: Central NY RR, from the CNYK website:

The Central New York Railroad (CNYK) operates 123 miles of railroad between Binghamton, NY and Port Jervis, NY. CNYK began operation of this line on December 31, 2004. The line is leased from Norfolk Southern Corporation (NS).

http://www.cnyk.com/

Let's make sure I have this straight.

Topper (NS) now owns the ERIE Bingo to Buffalo. He spent a "lot of oats" to build that new bridge over the Genesee River, so he obviously considers that line part of the core system.

Absent an emergency, I can't see why he'd have need for the ERIE East of Binghamton- let some Short Line handle whatever local traffic there is.

Again let me reiterate; Chessie out of PAS; she has her own B&A. There is no way the Commonwealth will seize it for some passenger train initiative.

A Shared Assets arrangement for everything East of Ayer/Worcester. With their experience dealing with both Chessie and Topper with the existing CRSA, Conrail should be in the game for such. Chessie and Topper will share the Fancy Feast and oats needed to make the non-passenger lines, i.e. the MEC, FRA Class 3.

Topper to be competitive will have to drop his own oats into PAS.