CSX Acquisition of Pan Am Railways

Agreed, I suspect he'll either hang onto it as an easy and reliable source of ongoing revenue (licensing fees), or sell it separately. It would be crazy to include it with the sale of the railroad.

There's always "Boston & Maine Central"

Reporting marks BMC and BMEC are both available...

Fortress paid about $3B for FEC in 2007 and seemed to manage the operation well before selling it 2017 to Grupo México Transportes, the leading rail freight transportation company in Mexico. But IIRC, FEC property and operation were in very good condition when Fortress acquired the straight and flat, tunnel-less FEC.

Cosakita18 wrote:the PanAm IP may be more valuable than the railroad itself and I highly doubt Mellon would let that go.

Extremely unlikely that "Pan Am" intellectual property is worth more than the railroad either by value or income. The intellectual property is probably worth $10M - $100M in fairytale land. The railroad is easily worth $100M+ all day long.

Royalty income is probably $5M-$10M for "Pan Am" (think about all the models, toys, bags, TV show reruns etc.). The margins are probably very good on all of that because there are virtually no costs. It probably costs $1M per year at most to administer.

The railroad on the other hand likely has revenues in the tens of millions or perhaps $100M+ with net income probably somewhere between $10M and $25M. If you take the 7x gross margin multiplier for a purchase of the business the implied value is around $700M. There's your $1B asking price.



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johnpbarlow wrote:But IIRC, FEC property and operation were in very good condition when Fortress acquired the straight and flat, tunnel-less FEC.

Maine Montreal & Atlantic was in tatters when they bought it and they did quite nicely on that project.

Notable to me that if Fortress is in the mix they will have significant knowledge that could be used to grow Pan Am's market share around the edges. Probably nothing earth shattering but still potential for meaningful gains.

Seems likely they would also strongly support business growth in intermodal.

Mr. Norman,

Both of our tickets could be left "on the floor".


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MEC407 wrote:There's always "Boston & Maine Central"

You've been waiting for how many years to suggest this??!?

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MEC407 wrote:It would be crazy to include it with the sale of the railroad.

Concur. Worth millions (and maybe more) as a spin-off. Mr. Mellon has done a very nice job of polishing the patina on the brand. When I was a kid and Pan Am was still flying they had a reputation for discounted fares but absolutely horrible food (so bad it usually would make people sick) and even worse service. The memory of that entire period of final decline has disappeared into the wind like a Clipper taking to the skies.



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NHV 669 wrote: ↑Wed Sep 09, 2020 1:11 pm

JoeCollege wrote: ↑ Can you please share with me who "Topper" is?

Hint: he's on every NS black/white locomotive, right on the logo.

Really? No horsin' around? Seriously, thanks.

Operationally speaking it is a non-issue. Also MSC had 5000 TEU ships in the rotation on the Canada Gulf Bridge service a few times, so really I don't know why this forum seems to have come across a prohibitive issue that massive global shipping companies aren't worried about.

Sorry man, I'm going to jab you a bit here... perhaps others are heeding the opinion you expressed about a port that actually has a less restrictive (albeit not tidal) draft restriction:

Montreal has a good bit of business but is really limited by the draft, they can only take ~5500 TEU vessels, which is starting to be considered sub-standard in many of the high volume lanes.

My comments did not imply a prohibitive situation. Rather, it's a logistical challenge that is a headwind to market development, especially as cellular vessel construction over the last decade has become stratified into three size ranges: 1-3K TEU, 12-15K TEU and 23-24K TEU.

gokeefe wrote: ↑Thu Sep 10, 2020 8:42 pm

johnpbarlow wrote:But IIRC, FEC property and operation were in very good condition when Fortress acquired the straight and flat, tunnel-less FEC.

Maine Montreal & Atlantic was in tatters when they bought it and they did quite nicely on that project.

Notable to me that if Fortress is in the mix they will have significant knowledge that could be used to grow Pan Am's market share around the edges. Probably nothing earth shattering but still potential for meaningful gains.

Seems likely they would also strongly support business growth in intermodal. ...

MMA was a bankruptcy auction, literally & unfortunately a fire sale. Didn't MMA make some modest improvements to the track during their tenure? PAR won't be such a bargain.

FEC had valuable real estate to develop. Boston and Maine - Maine Central (Which is what was on the side of the Yankee Flyer) has been stripped of almost all real estate that can be sold, has been sold. Perhaps Mellon could get a bigger payout now if he had kept some of the real estate in the package. As for livery, a pine tree with a McGinis B&M on a PAR-blue-dip with a canary-yellow racing stripe or two. Guilford has negative connotations for a name. So I'd call the whole thing just B&M but with the pine tree in the logo.

Should Pan Am brands be stripped away prior to the closing, trust some "exciting" corporate name such as "New England Railroad Acquisition Corporation" will be ready to go.

CN9634 wrote: ↑Wed Sep 09, 2020 3:34 pm Operationally speaking it is a non-issue. Also MSC had 5000 TEU ships in the rotation on the Canada Gulf Bridge service a few times, so really I don't know why this forum seems to have come across a prohibitive issue that massive global shipping companies aren't worried about.

Mr. CN, here's a chart of Saint John harbor. The soundings are in feet at MLW.

https://www.bing.com/images/search?view ... ist=0&vt=1

Here are tidal charts:

https://tides.mobilegeographics.com/locations/6979.html

Now I do not hold, or ever have, any kind of a mariner's license, but "in an earlier life", I was around this stuff enough to know that those tides in that harbor create a few more challenges than rowing a boat across a mill pond.

I would think that the Master (Captain) of an ocean going vessel would want to sail only at slack water, which is usually about one hour across high or low water. Considering that the harbor is accessed through a dredged channel, there is not too much "wiggle room" should there be a machinery (engine) failure. It's not like our world of trains around here where the engine dies and, absent gross negligence as in Megantic, the train stops dead.

Finally, while me must respect that Mr. Cowford chooses not to share his relationship with the maritime industry around here, his thoughts regarding such appear "expert" and should accordingly be respected as such.

I am not nautically aware but just wondering if these great tidal shifts could actually allow larger ships. If the immediate dock area is kept deep enough could larger ships arrive and depart at high tide without the need to dredge the entire harbor which would be necessary at competitive harbors?

Mr. Train Guy, picture is worth a thousand words

Uh, "not exactly" a mill pond up that way.

Lest we forget, ocean going vessels are, again, "not exactly" designed to be beached.

MEC407 wrote: ↑Thu Sep 10, 2020 3:59 pm There's always "Boston & Maine Central"

Reporting marks BMC and BMEC are both available...

I like that.