CSX Acquisition of Pan Am Railways

https://trn.trains.com/news/news-wire/2 ... s-for-sale

New England's Pan Am Railways for sale
Possible suitors for North America's largest regional include Class I railroads, shortline holding companies, infrastructure funds

Article behind a paywall.

Wonder what changed? Or has it just always been for sale to the right buyer/for the right price?

Lets hope its not on G&W's radar... we've got enough orange and black. NS a possibility?

From what I've heard the Hoosac Tunnel issue moved the needle.

That said, NS is the natural choice but has their own financial issues and is going through operational hell due to PSR. I can't see them making a move. CP is also an option esp connecting with them at XO but they just made their move in Maine so not sure what they're appetite is. Could see CP taking over PAR half of PAS and someone else getting the rest of the system east of there. G&W I think would face serious STB scrutiny. Watco maybe?

Either way I don't see anyone wanting the entire system. Personally I could give two sh*ts what paint there is as long as whoever gets it are good stewards.

Rigby seems like a natural dividing line, and I doubt any class 1 would be interested in D1 north of Portland unless there was some emerging connecting potential from CP / CN in Atlantic Canada

The only problem with stopping at Rigby is that doesn’t get you to the big traffic producers like Sappi, ND, Pixelle, Irving, etc unless there’s some type of paper barrier in place. if you’re going to pay all that money you can’t afford to be fighting for traffic against SLR/CN and CP.

Perhaps Watco for D1 due them already switching Rumford and Old Town?

Wow . . . what a surprise. This might get very interesting!

Cosakita18 wrote: ↑Mon Jun 29, 2020 5:38 pm Rigby seems like a natural dividing line, and I doubt any class 1 would be interested in D1 north of Portland unless there was some emerging connecting potential from CP / CN in Atlantic Canada

Well there are big plans to expand the Saint John container port and that might be a good reason for NS to stretch their reach further east plus there seems to be new life for some of the paper mills in Maine .

Interesting timing, what with Mr. Mellon's recent bout of less-than-flattering media attention.

This project will help make Pan Am a bit more attractive maybe:

https://www.mainebiz.biz/article/two-ye ... s-underway

I hope Irving's New Brunswick Southern gets the line to Portland.

bostontrainguy wrote:This project will help make Pan Am a bit more attractive maybe:

https://www.mainebiz.biz/article/two-ye ... s-underway

But didn't Mr. Mellon say he didn't like the dependency Syndrome"

If anything, I see this as an opportunity for NS to pull out of the Patriot Corridor, and eventually get completely out of NYS by selling the southern tier line and the D&H. The current regime at NS is in full cut back mode and with only a few trains a day, no coal traffic , Bellevue Hump Idled and high NYS taxes , I could see this happening

Yep, that's my thought. Down to a single pair on the Sunbury and not much better on the Tier, NS is certainly in no position to make any moves. They are in slice and dice mode. I see a chance to pull out entirely of at least PAS if not further.

NS continues to pour money into both the D&H and Southern Tier tracks in 2020 with curve rail replacement and lots of stone dumping plus Taylor Yard (Scranton) renovation so if its intent is to unload these properties, it's doing so in a non-intuitive way. 22K with containers bound for Taylor, Ayer, and Mechanicville typically operates at a 2 mile length with relatively few empty wells these days. 309/310 Elkhart-Binghamton manifests are operated as monster trains about every other day with not only frack sand for the Southern Tier but also increasing #s of loaded autoracks headed for Mechanicville, Davisville, and Ayer. Similary, 11Z seems to attain 13K to 15K tons every other day with trash out of Ayer adding to the consist. East Binghamton yard is still fairly busy originating/terminating 10 carload road freights daily. I'm not convinced that NS wants to shell out $ now to buy the other half of PAS either but I would guess, that if not, it would want it to fall into friendly hands to continue to be a traffic anchor for IM and 11R/16R carload business.

On a different note, I found this statement in the Trains Magazine on-line article re: Pan Am being for sale provocative - it's not obvious from looking at the non-subsidized portion of Pan Am assets.

Despite changing traffic patterns in New England, Pan Am has been profitable every year since it was founded in 1981 as Guilford Transportation Industries.

My guess is PAS goes to NS and PAR goes to G&W.

No way NS would want to abandon PAS. They've dumped a lot of time and money into that system. 22/23K is a solid moneymaker and they do well with autoracks. Abandoning PAS is basically handing the entire Boston area to CSX.

The PAR system east of Ayer will almost certainly be split up, it doesn't make much sense logistically as it is now.

If NS doesn't go east of Ayer, G&W is by far the most logical buyer. There would be solid IM demand from Ayer to Montreal if the line was under one owner.

There's also the IMT in Portland, which is small but is New England's only rail accessible container port, and is in an objectively ideal position geographically to capture container traffic bound for Montreal and / or upstate NY . A few upgrades and Portland could become a significant feeder port. That's got to factor in somehow.