CSX Acquisition of Pan Am Railways

Makes me wonder who's bid landed second.

There must be a "Poison Pill" that makes CSX BALK

Time to "check in on the latest" around here.

There are all kind of factors that could derail a deal such as this, but I could never have imagined that one of such is that the "Commonwealth of Tax..." is prepared to seize the B&A from Chessie for some kind of passenger train initiative.

You'd think that the stumbling block would be an issue of importance; that Authorities want to develop the three maritime ports (Saint John, Searsport, and Portland) by promoting them of the sailing time savings they'd offer over other East Coast ports - and bringing good paying Union jobs to a region badly needing such (hey, Mickey D, Wally World, and "beasty woman"are all hiring; so what's the big deal?), would be lack of competitive rail (OK; Soo/CP has an E-W line; serving one of those ports but such is directed towards Canada).

Possibly my competitive rail concerns are "over blown", but when you consider that every US East, Gulf, or West Coast port can offer such (Canada? admittedly not so true), why isn't Timmy pushing for a "Shared Assets" arrangement for the Maine Central lines. Absent some "Chattanooga Choo Choo" push by Mass pols, there are already competitive E-W routes there (well, if a Class 2 rinky dink and an "obstruction" prone to cave ins is competition), and NH, who cares?, "Shared Assets", providing equal access to both Chessie and Topper (maybe SOO Line) will mollify the Surf Board and the maritime companies - both of whom favor competitive rail.

I just can't see CSX or Pan Am walking away from this deal so quickly.

Railroads have walked away over less

No doubt, I just can't picture that they've already reached that point.

As I cautioned at the start, until a deal is closed there is no final deal. The corollary is that until there’s announcement that a party has walked, the presumption is that discussions are continuing. Breakthroughs happen, sometimes suddenly. Moreover, it is common for purchase contracts to have break up fees or other conditions that make it hard (but not impossible)for a buyer to walk as the sellers want assurances that the deal will likely close. So, since I have no knowledge of the actual state of play between the various interested parties, my assumption is that negotiations are continuing

F74265A wrote: ↑Fri Feb 05, 2021 10:14 am As I cautioned at the start, until a deal is closed there is no final deal.

But CSX has said:

"JACKSONVILLE, Fla. – November 30, 2020 - CSX Corp. (NASDAQ: CSX) today announced that it has signed a definitive agreement to acquire New England’s Pan Am Railways, Inc. (“Pan Am”), whose rail carrier subsidiaries comprise North America’s largest regional railroad."

Does that not indicate that a deal was closed?

I thought we were just waiting for the STB part.

With the change of admin in DC there might be a minor delay at STB,still think there's a "poison pill" that's making the "hedge fund goons" BALK.

bostontrainguy wrote: ↑Fri Feb 05, 2021 11:45 am Does that not indicate that a deal was closed?

I thought we were just waiting for the STB part.

Have you purchased a house? They signed the P&S agreement, but not the closing docs. Those don't get signed before regulatory approval.

Regarding Mr. Backshop's thought, here is the Board:

https://prod.stb.gov/about-stb/board-members/

Note that there is one vacancy, and right now I think Joe has a "few more pressing items on the plate" than filling it.

Joe did elevate Chairman Oberman from a Trump appointed Member; apparently the Senate has confirmed him.

I still think the "competitive rail" issue could be a stumbling block. After all, PAR did represent for shippers equal access to both Chessie and Topper. Even though I know it gained initiative with some Mass Legislators, I'd like to think this passenger train issue noted at the discussion has been laid to rest.

Backshophoss wrote: ↑Fri Feb 05, 2021 1:01 pm With the change of admin in DC there might be a minor delay at STB,still think there's a "poison pill" that's making the "hedge fund goons" BALK.

I think there may be merit in that. They had all last fall going for rides in the OCS all over the system with reportedly different players and they must have worked out a deal for CSX to make that announcement at the end off Nov. Someone may have balked at the deal. I still think the main sticking point is how do you deal with PAS and any kind of agreement about shared access for traffic coming out of Maine. Could NS have thrown some kind of roadblock by backing out of any previous deal that was made. In their last quarterly statements they went out of their way to stress to the stockholders that they were concentrating on "right sizing" the railroad. Seems that they are still in the slash and burn policy of PSR. Maybe they want no part of PAS now.

bostontrainguy wrote: ↑Fri Feb 05, 2021 11:45 am Does that not indicate that a deal was closed?

I thought we were just waiting for the STB part.

In corporate transactions there is customarily a delay between signing the definitive contract and closing in order for conditions of the contract to be met, including regulatory approval. Occasionally deals close on signing if no regulatory approval is required. Closing occurs when buyer actually pays the purchase price and seller delivers title to the property

Hold up definitely on the CSX side.... no app nothing for the STB to “delay”. Deal is still a go but items still need to be resolved PAS wise (surprise).

Gilbert B Norman wrote: ↑Fri Feb 05, 2021 7:44 am There are all kind of factors that could derail a deal such as this, but I could never have imagined that one of such is that the "Commonwealth of Tax..." is prepared to seize the B&A from Chessie for some kind of passenger train initiative.

Mr. Norman, it can't be assumed that it would be a seizure or that CSX would not want to do nor benefit from an infrastructure deal.

Additionally, it should not be assumed that it would necessarily involve the entire B&A from CP-45 to CP-187 and/or all traffic; would not include rights, not be phased in over time, or damage CSX's franchise; or, be made public or not held very closely by those "in the rooms where it happens".

There's too much political power and possibility; potential money to be saved, protected or made; and, CSX deal-making history to entirely dismiss the possibility at this early point that CSX pursued PAR at least in part for the ownership stake in PAS with the intention at some point to make a deal with the Commonwealth and move traffic off the B&A . Only when a CSX ownership stake in PAS is off the table should this possibility be taken off the table, but even then....

I would think that the negotiation with NS might be affected by Squires & Co's fight at this time for their own survival with singular focus on accelerated PSR implementation aimed to close the OR gap with CSX.