The Surface Transportation Board (STB) has accepted for consideration CSX’s amended and re-filed Pan Am Railways acquisition application, and set a procedural schedule, with a final decision to be rendered April 1, 2022. The proposed merger is also gaining support, CSX reported.
The STB’s decision—published in the Federal Register on July 30 (download below)—also preliminarily determines that environmental and historic review is not necessary and requests additional environmental information from CSX by Aug. 19.
STB on May 26 rejected as “incomplete” the merger application filed by CSX Transportation, Inc. to acquire control of Pan Am Systems, Inc. and its short line railroad subsidiaries. STB said it “found that the application did not include all of the information necessary for purposes of a ‘significant’ transaction under the Board’s regulations.”
Pan Am, headquartered in North Billerica, Mass., owns and operates a nearly 1,200-mile rail network across New England and has a partial interest in the more-than 600-mile Pan Am Southern system, jointly owned with Norfolk Southern. Pan Am’s network reaches multiple ports and large-scale commodity producers. The transaction will expand CSX’s reach in Connecticut, New York and Massachusetts, while adding Vermont, New Hampshire and Maine to its existing 23-state network.
Public comments on the revised application are due Aug. 27, and comments on the environmental information are due Sept. 17. Download Federal Register notice below for the full procedural schedule.
Support Grows for CSX-Pan Am Merger Proposal
CSX on July 29 reported that its proposed merger with Pan Am Railways has garnered support from some 90 stakeholders. Among the most recent are Maine Gov. Janet T. Mills as well as four shippers, two municipalities, and one member of the New York State Assembly—all of whom have filed letters with the STB.
Following are highlights of their statements, provided by the Class I railroad:
• Gov. Mills: “This transaction has the potential to bring substantial benefits to Maine. The state of Maine relies on rail traffic to deliver goods and support our economy. If the transaction is approved, CSX has indicated that it will make upgrades to track and locomotives to provide improved service, extend positive train control on Amtrak’s Downeaster, and make other improvements to the rail network. These changes would benefit Maine businesses and shippers that rely on freight rail to ship products and goods and positively impact passenger rail service.”
• Mark Gasbarro, Owner and President, F&M Tool and Plastics (Leominster, Mass.): F&M Tool and Plastics “looks forward to the improved service that we will receive from CSX following the approval by the Surface Transportation Board of the merger.”
• Brunswick Valley Lumber (Fredericton, New Brunswick, Canada): The CSX-Pan Am combination will allow Brunswick Valley Lumber to “implement new supply chain solutions and market opportunities” and enhance its competitiveness through “lower costs, better service, and improved access to the North American rail network.”
• Tony Gentile, General Manager, Cooperative Reserve Supply (North Billerica, Mass.): CSX’s standards of service performance will lead to “higher velocity, faster equipment turns, and greater consistency” that should “enhance [their] competitiveness.”
• Saratoga County (N.Y.) Administrator Steve Bulger: Freight railroads are oftentimes “the lifeblood” for communities, and a benefit of the proposed transaction is that CSX will “enhance competition through lower costs, better service and improved access” to the rail network in the Eastern U.S.
• Mechanicville (N.Y.) Mayor Dennis Baker: CSX summarized that he “sees the deal as a way to increase freight rail service to his community and capitalize on the financial resources CSX brings to the table to undertake ‘much needed infrastructure improvements’ across Pan Am’s rail network.”
• New York State Assemblywoman (113th Assembly District) Carrie Woerner: “I support this proposed acquisition and believe my constituents will benefit from its adoption.”