Acquisition of Pan Am Railways back on track
Norfolk Southern drops objections after reaching deal with CSX
CSX Transportation is filings its application to acquire Pan Am Railways with the federal Surface Transportation Board, the federal agency that regulates the railroad industry, according to a report in Railway Age.
Pan Am owns and operates 1,700 miles of track in New England, including 121 in New Hampshire. Terms of the transaction have not been disclosed.
Last November, when CSX first announced it was negotiating the transaction, Norfolk Southern Railway informed the federal regulators that it would challenge the deal, which it claimed would stifle competition with adverse impacts on other railroads and commercial shippers in New England.
Pan Am and Norfolk Southern are partners in a joint venture known as Pan Am Southern, which provides Norfolk Southern with access to New England by way of trackage rights on the 437 miles of the Patriot Corridor between Mechanicsville, N.Y., and Ayer, Mass.
But the differences between CSX and Norfolk Southern have been overcome, with the latter keeping its 50% share in Pan Am Southern and CSX acquiring Pan Am’s share. And Pan Am Southern will be operated and maintained by a neutral entity, Genesee & Wyoming Inc. through a newly formed subsidiary, Berkshire & Eastern.
Norfolk Southern also will acquire trackage rights on CSX and Pan Am rails between Albany, N.Y., and Ayer, Mass., via Worcester, Mass., skirting the tight clearance limits of the 4.75-mile Hoosac Tunnel in western Massachusetts and sparing three hours travel time.
Headquartered in Billerica, Mass., Pan Am Railways is a privately held company owned by Timothy Mellon, heir to the Mellon family fortune, and other investors. It provides freight service in Massachusetts, New York, Connecticut, Maine and Vermont as well as New Hampshire. Its rails connect to the Canadian National Railway, Canadian Pacific Railway, CSX and Norfolk Southern Railway as well as 20 other regional and shortline systems.
In New Hampshire., CSX will acquire all five railway lines owned and operated by Pan Am. The Main Line runs 35 miles between Plaistow and Rollinsford, carrying the Amtrak Downeaster between Boston and Portland with stops in Exeter, Durham and Dover.
The NH Main Line stretches more than 40 miles from Nashua to Concord and carries three-quarters of all freight (by weight) reaching the state by rail. Perhaps most significantly, the main line runs within the Capitol Corridor, the preferred route for extending passenger rail service from greater Boston to Nashua, Manchester and perhaps Concord.
The 12-mile Hillsboro Branch, known as “the Hillsboro Running Track,” connects Nashua and Wilton and to the state-owned line, operated by the Milford-Bennington Railroad that extends the service 18 miles to Bennington.
On the Seacoast, Pan Am owns and operates the 10 miles of track between Portsmouth and Newfields and another 3.5 miles of track between Portsmouth and Newington.
CSX will also acquire Pan Am’s haulage rights on the 394 miles of the Connecticut River Line operated by the New England Central Railroad, a subsidiary of Genesee & Wyoming, between White River Junction, Vt., and New London, Connecticut, which includes 24 miles of track in New Hampshire between Walpole and Cornish.