Proposed Sale of Conrail Lines to P&LE in 1985

The following link is to a Conrail document suggesting the sale of a number of lines to P&LE. It's dated 1985, which is before NS decided to withdrawl it's takeover bid. But the description of this sale doesn't mention NS or Guilford, per NS's plans to sale off the ex-W&LE to the P&LE should it get CR. I have never seen or heard anything about the sale of these lines to P&LE. Obviously it didn't happen, but does anyone have any more info on this possible sale of rail lines?

http://www.multimodalways.org/docs/rail ... c.1985.pdf

Any information would be greatly appreciated. It seems like a number of these lines would have made the Little Giant a tidy profit and probably kept it from going bankrupt and being folded into CSX. But then again, a number of the lines seem like they would be a drain on the rest of the system. Any thoughts on this expanded Pittsburgh & Lake Erie?

From what I understand, P&LE wanted to acquire the Meadville Line, then the Southern Tier from Hornell to Bingo. They also had designs about running all the way to Croxton Yard. But I think their main goal was to deliver coal from the Monongahela to the D&H at Bingo, and then the D&H and B&M would take the coal right to Mt. Tom and Bow.

The Little Giant would have gotten a little bigger, that's for sure!

-otto-

I actually found this a couple days ago:

http://www.rrdc.com/spch_p&le_2002.htm

It mentions P&LE's last ditch efforts to acquire the Meadville line - and apparently CR was willing to sell it. I knew they had hauled coal into NY state based on pictures I've seen, but I never knew about these efforts to expand to save their railroad. Would Conrail really have been willing to sell off the Southern Tier? I know they considered selling it to CP during this same 1991 time frame, but that fell through.

I think there was an issue of financing that scared off Conrail from the deal. There was a complicated web of financing and loan guarantees negotiated for purchase of the Meadville Line, and part of the Tier. From what I understand, CSX Transportation was guaranteeing the guarantees, and when Conrail found out, they blocked the deal. It was a moot point, while P&LE was arranging financing, they were busy going bankrupt.

-otto-

That would have been part of the proposed "ProRail" system I believe. During NS's first push to buy Conrail in the mid 1980's Guilford, P&LE and Grand Trunk proposed developing ProRail as competition to post Conrail purchase NS system. Among the lines that would have been stitched togther to create ProRail was the former PRR main across Ohio & Indiana & into Chicago (as a side story - apparently the "powers that be" of the proposed system did not know that Conrail had single tracked & downgraded the line a few years prior to that - they still thought it was intact as double track all the way into Chicago!). They also proposed purchasing from the NS, their line from Delphos Ohio down to St. Louis (former Cloverleaf). Which by this time was no more than a streak of rust across Ohio, Indiana & Illinois. As it turned out, NS was rebuffed from their purchase of Conrail at that time - and without a reason for being, the ProRail proposal died rather quietly. If you have access to Trains Magazines from that time, there were some good editorials & Columns on ProRail by DPM & Don Phillips - they're worth a read.

This is the first I have ever heard of a "ProRail" counter-proposal... interesting!

I think the P&LE realized that the danger in their market was being tied to one commodity, and they should take steps to investigate possible expansion of their territory. It worked for tiny salt-hauling Genesee & Wyoming, when they picked up the former BR&P from CSX in 1985, they quickly expanded into a regional railroad and grew their traffic base beyond the traditional rock salt. I think if P&LE had their way, they would have been running time freights from Croxton to Buffalo with the D&H as their major connection to New England and Potomac Yard... but the P&LE embarked on their plan too late in life, and thus was quickly absorbed by the economic realities of the 1990s.

I have seen many photos in books such as Tom Nelligan's 'Bluebirds and Minutemen" which have photos of P&LE run through power. Most of this was on the Bow coal trains. What route did they use to connect between the P&LE, and the D&H (still Big G then)? I have heard some rumors that one of the Mellons had a stake in P&LE. It may be a rumor, but they are from the Pittsburgh area.

Conrail from Erie to Buffalo if I remember right, some kind of trackage rights arrangement.

Both Santa Fe and Norfolk Southern both put bids in on Conrail in 1985 but ATSF backed out in favor of the Failed take over of Southern Pacific and Norfolk Southern backed out with to low of a bid. There were was some chatter about breaking conrail up to several other bidders such as Guilford, P&LE, Indiana Harbour Belt, and Pioneer Rail Corp. Still Yet 4 Major Banks and 2 or 3 holding companys also had bids on Conrail as well. As is this never happened and the company was sold on the NY Stock Exchange makeing for the biggest stock offering in U.S. History!