WASHINGTON — The Surface Transportation Board today accepted Canadian National’s application to acquire short line Iowa Northern Railway, said the $230 million deal qualifies as a minor transaction, and set a schedule for a review of the merger.
The STB must approve minor transactions unless it finds a merger would harm competition. CN says acquisition of the 218-mile Iowa Northern will boost rail competition, divert freight off the highway, and give Iowa shippers broader access to single-line service.
Parties interested in participating in the proceeding must notify the STB by March 15. All comments, protests, and requests for conditions must be received by April 1. Responses to comments are due by May 1.
The board’s final decision will be issued by July 26, with an effective date of Aug. 25 or 30 days after approval of the merger.
The National Feed and Grain Association, which represents agricultural shippers, this week asked the board to consider the merger a significant transaction, which would require a more detailed review.
“The NGFA’s general position on railroad transactions … in today’s consolidated railroad industry has been that the Board should err on the side of closely scrutinizing any such transaction for its potential impacts on competition, service, and agricultural markets,” the trade group said.
The board’s decision is available here.
I agree with the other commenters that this one doesn’t make sense. It feels more like eliminating a local competitor.
Considering that Iowa Northern parallels CN for most of its length, and that CN and Iowa Northern are the only railroads in Waterloo, I don’t see how this can NOT harm competition. However they STB has a pretty strong track record of approving class I acquisitions of short lines/regionals, so this will probably be approved. It will be a sad day in Iowa.
there’s something i just don’t get it how can railroad mergers solve anything ?
When RR mergers first stated, it was either to expand the reach into new territory of the larger of the RR companies or to eliminate duplicate track and facilities in an area that had too many RRs for too small a “pie”.
Still can’t figure this one out. Iowa Northern is less than a rounding error at CN. The number of carloads is miniscule compared to CN daily movements. And there is no frack oil under Iowa. Scratching my head.
unfortunately those rail customers on the Iowa northern may as well start looking for trucks