Regulators approve CSX Transportation's acquisition of Pan Am Railways (updated)
By Bill Stephens | April 14, 2022
Surface Transportation Board agrees that deal will improve rail service in New England.
WASHINGTON – Federal regulators on Thursday gave the green light to CSX Transportation’s acquisition of New England regional Pan Am Railways.
The Surface Transportation Board’s unanimous, 75-page decision approving the merger becomes effective on May 14. But CSX said it planned to close on the transaction on June 1.
Regulators largely agreed with CSX’s arguments that the merger will result in much-needed capital improvements to the worn out Pan Am system while improving service and safety. CSX has pledged to spend more than $100 million to improve Pan Am’s track, bridges, and yards as well as its aging and failure-prone locomotive fleet, over the next three years.
“After a searching review of the well-developed record in this proceeding, which included a two-day public hearing before the full Board, the Board concluded that this transaction satisfies the statutory criteria based on CSX’s representations to the Board. I look forward to improvements in the rail network with respect to reliable service and competitive transportation options in New England and beyond,” STB Chairman Martin J. Oberman said.
CSX, already the dominant freight railroad in the region, will extend its reach into Vermont, New Hampshire, and Maine, as well as to Saint John, New Brunswick, via Pan Am’s haulage rights agreement with Irving-owned short lines. . .
Pan Am entered the rail business in 1981 when the company, then known as Guilford Transportation Industries, purchased the Maine Central for $15 million. Two years later, Guilford purchased the bankrupt Boston & Maine for $24.5 million. Guilford acquired the Delaware & Hudson from Norfolk & Western for $500,000 in 1984, but cast it off into bankruptcy in 1988.
Guilford Rail System was rebranded as Pan Am in 2006. Despite the long-term decline of Maine’s paper and forest product industries, as well as manufacturing across New England, Pan Am and Guilford have managed to turn a profit every year.'>>>
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