Federal agency sets timeline for proposed CSX-Pan Am rail merger

Decision on acquisition scheduled for spring 2022

Csx Earnings Presentation

The federal Surface Transportation Board has accepted CSX Transportation’s revised application to acquire Pan Am Railways and set a procedural schedule for considering the transaction, with a decision announced by April 1, 2022.

CSX began negotiating with Pan Am last November, and in February submitted its first application to the board. Twice the board has found applications wanting and twice the company has revised them, most recently by adding both an operations and marketing plan to address concerns about the projected growth of traffic volume on both freight and passenger services.

In particular, Norfolk Southern, which initially questioned the deal, is party to the transaction and has trackage rights over the rails between Albany, N.Y., and Worcester, Mass., which CSXT would acquire.

Amtrak operates a half-dozen passenger services, including the Downeaster through New Hampshire, over rails subject to the acquisition. And five commuter rail services, in Connecticut and Massachusetts are also carried on tracks owned or used by Pan Am.

These include the MBTA line between Lowell and Boston, the extension of which to Manchester, Nashua and perhaps Concord — the Capitol Corridor — is the subject of ongoing evaluation by the New Hampshire Department of Transportation.

In its revised application, CSX commits “to cooperatively work with MBTA and MassDOT to consider the introduction and expansion of passenger service on request.”

Likewise, CSX said it will make significant investments in tracks, locomotives and signaling to improve the infrastructure of the Pan Am system that it says will increase efficiency, raise the speed trains travel and enhance the safety of rail traffic.

Nearly 90 shippers, public officials and railroad operators across the Northeast and Canada have written to the Surface Transportation Board in support of the transaction. In New Hampshire, Gov. Chris Sununu, along with Senators Regina Birdsell, a Hampstead Republican, David Watters, a Democrat from Dover, and Bill Gannon, a Sandown Republican, as well as Mayor Joyce Craig of Manchester have expressed support for the acquisition.

Rep. Peter Leishman, D-Peterborough, who operates the Milford-Bennington Railroad Company between Wilton and Bennington, told the Surface Transportation Board his company’s relationship with Pan Am has been “contentious” and believes CSX “will be a far better business partner.”

Operating on 1,200 miles of track in the Northeast – 121 of them in New Hampshire — Pan Am is the largest regional railroad in the country. CSX operates on more than 20,000 miles of track in the eastern half of the United States and the Canadian provinces of Ontario and Quebec.

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