D&H up for sale?!

[NV290]

Guilford / PanAm Railways Intermodal trains (PIG TRAINS) AYMO & MOAY
Ayer,Ma to Mohawk Yard,and return, is run and marketed by the N.S.

Yes, i am aware of those as well as the new NS auto facility in Ayer, NS's money spent for tunnel upgrades in the Hoosac and talk of them spending millions on more track upgrades in the very near future.

[Skullitor]

Guilford / PanAm Railways Intermodal trains (PIG TRAINS) AYMO & MOAY
Ayer,Ma to Mohawk Yard,and return, is run and marketed by the N.S.

Yes, i am aware of those as well as the new NS auto facility in Ayer, NS's money spent for tunnel upgrades in the Hoosac and talk of them spending millions on more track upgrades in the very near future.

My sources in PAR say watch out next spring as N.S. is gonna rebuild the west end and most of District 3 as far east as Fitchburg,Ma. with 136 pound welded rail.Possable Concrete ties from C.P.

[Otto Vondrak]

See also: http://railroad.net/forums/viewtopic.php?t=829

[conrailsharedassets]

Hello,

It has been brought to my attention, that CP's Delaware and Hudson may be on the market. The sum I heard was $25,000,000 (which seems a little low to me). Apparently CP has stated the D&H is losing them money and they are no longer interested in it. This may very well be the case, as alot of the MOW/Signal work that was planned is now either on hold or cancelled and CP's trains have been steadily shrinking.

Obviously the most interested party is supposedly Norfolk Southern, but they from what I was told feel the price is too high? (Again this seems odd). Other interested parties are Canadian National (just as they have been in the past) and even Reading and Northern RR (but the price is too high for the regional RR).

I'm just passing along what I heard so please DO NOT shoot the messenger. Lets try to keep the conversation civil. I was just curious if anyone has heard anything to confirm and or prove what I was told right or wrong?

Jim

[SecaucusJunction]

$25,000,000 should be nothing for NS for a huge piece of railroad like this. The trackage is invaluable to them to at least have access to. They just paid about 5x that much for one intermodal facility in TN.

[Jeff Smith]

No one's shooting the messenger but what's your source?

[conrailsharedassets]

Jeff this is coming from a few railroad employees I know at CP, NS and R&N. I will not give out their names... They all had similar things to say and none of them know each other. So that makes me believe there is something to it.

I know it has been on the market before and CN was the high bidder, when CP saw that it was quickly pulled.

Now that NS has such an interest in the railroad, it would make sense it goes to them if and when it is on the market.

Obviously what they told me is nothing by hear say until something if anything concrete is released on the subject.

Jim

[Jeff Smith]

Understood, thanks. No need to reveal sources (I actually frown on that), just types are fine by me. This way a knowledgable discussion can be had by all.

[cjvrr]

If it were true, that offer would be very low. For comparison Ohio Central sold for $220 million.

[poppyl]

I agree with Secaucus that NS makes the most sense from the operational perspective -- at least between Sunbury, Binghamton, and Mechancisville -- as a bridge between the Crescent and Patriot (Pan Am) corridors. Also could bode well for traffic on the Tier, too.

Poppyl

[blockline4180]

I also heard "rumors" from "employees in the know" that CSX was making offers as well...This could get very interesting!

[Matt Langworthy]

I also heard "rumors" from "employees in the know" that CSX was making offers as well...This could get very interesting!

I don't think the STB would approve a CSX takeover of the D&H, since it would drastically reduce competition in New England and upstate NY.

[ccutler]

Taxes in NYS are the highest in the country for railroads. It would make sense to try to keep the value of fixed assets low on the D&H, for instance by using "fully depreciated" engines and not investing heavily in expensive trackwork if your not running a 'trunk line' because of the exceptionally high NYS taxes. All these considerations probably would also keep a sale price lower.

I remember BNSF wanting to merge with CN, but the two main complications were the STB not wanting to risk another rail merger operational fiasco, and Canadian law requiring Canadian railroads to be the controlling/surviving entity. I don't see UP taking orders from Canada, despite the general cool-ness of most Canadians.

[Noel Weaver]

Sounds to me like the "rumor mill" is at work again. Often rumors start among the troops and often die among the troops too. It might happen but don't bet on it.
I think this would make a lot more sense for the NS than for CSX but it might not make sense for either one of them.
Noel Weaver

[SecaucusJunction]

I really think either that $25M number is wrong or they're really just trying to dump this piece of railroad. I can't see NS causing a problem on the asking price. If anything it would be trying to make the line profitable from taxes and maintenance.

Whoever gets it, I'm sure the STB will allow NS and CSX to keep their haulage rights over the respective sections. I wouldn't be shocked if the tracks either became shared or get leased out for tax breaks with the bigger roads retaining rights...