BANGOR, Maine — The Canadian Pacific plans to close on its purchase of the Central Maine & Quebec on Dec. 30, according to an application filed with the Surface Transportation Board this week.
On Dec. 17, the CP filed an application with the STB to approve its acquisition of the 481-mile short line connecting Quebec with northern New England. CP announced it was buying the CM&Q on Nov. 20 for $130 million. The sale comes 25 years after the Class I railroad pulled out of the region when it sold its lines east of Montreal.
The application states that CM&Q will be owned by the Soo Line Corp., CP’s American subsidiary, which owns and operates the Soo Line Railroad Co.; Dakota, Minnesota & Eastern Railroad Corp.; and the Delaware and Hudson Railway Co. Inc. Last month, CP officials told Trains News Wire that CM&Q, “will continue to operate as a distinct and separate entity.”
Because the acquisition is considered a “minor” transaction it is likely the STB will approve the deal with little hesitancy. However, until the deal is approved by the federal regulator, CM&Q will be placed into an “independent voting trust” and continue to operate as normal.
The application states that at first, little will change on CM&Q, even after the STB gives its approval. “Eventually, the integration of CP and CMQR train operations will facilitate train start rationalization, resulting in fewer but longer main line trains and fewer yard local assignments, and an increase in the frequency of selected trains and assignments from five-or-fewer days a week to up to seven days a week.”
To aid in the operation of longer trains, CP plans on lengthening the yard tracks at Saint-Jean-sur-Richelieu, Que., where CP and CM&Q currently exchanges traffic, so that it can handle trains in excess of 4,500 feet.
According to the application, CP plans on investing upwards of $75 million into the CM&Q system over the next three years to increase track speeds and capacity. CP plans on upgrading much of the system to FRA Class 3 standards.
“CP anticipates that this capital plan will include extensive tie replacement, rail replacement, joint elimination, shoulder cleaning, and switch and grade crossing upgrades,” railroad officials write.
CP officials write that initially, most CM&Q employees will keep their jobs, particularly in maintenance and operations. Over time, most management positions will be absorbed by its parent company.
CM&Q currently handles 24,000 carloads annually; CP hopes to increase traffic by 2% to 3% per year over the next three years, particularly to the ports of Searsport, Maine, and Saint John, New Brunswick.
The CM&Q includes the former CP main line across eastern Quebec and western Maine to Brownville Junction, where it interchanges with the Eastern Maine Railway, owned by J.D. Irving. The railroad also includes the former Bangor & Aroostook north to Millinocket and south to Northern Maine Junction, near Bangor, and Searsport. CM&Q is also contracted by the State of Maine to operate the former Maine Central Rockland Branch.
In 1995, CP sold its main line to the Maritimes to Iron Road Railways and J.D. Irving. Iron Road merged its portion of the CP with the Bangor & Aroostook. In 2002, Iron Road sold the railroad to Ed Burkhardt’s Rail World Inc., which renamed it the Montreal Maine & Atlantic. The MM&A struggled through the 2000s, thanks in large part to the decline of Maine’s paper industry. In 2010, MM&A sold a large chunk of the former Bangor & Aroostook to the State of Maine that in turn leased it to J.D. Irving. In July 2013, an MM&A oil train derailed and exploded in the small town of Lac-Mégantic, Que., leveling more than 30 buildings and killing 47 people. The railroad filed for bankruptcy a month later and in 2014 it was sold to Fortress, which created CM&Q.
good luck to the business on the line as your service will go away, may as well call the trucking company’s. CP service philosophy is to get rid of as much business as possibe, make life miserable for those that are left and Jack the rates up as high as possible to get rid of them.
“Longer freight trains”! I detect the E. H. Harrison operating philosophy rising up again, even though CP & its’ employees suffered previously! 25 years later CP buys back what it sold in 1995.
The line has to be worth something. The Canadian Government is spending a few million to move the Lec Megantic line north of town. Let’s see how much CP, sorry, the Soo spends on fixing the rest up.
CANDID.ORG CHARITIES
I wonder what is going to happen to the Rockland branch. Isolated from the rest of the system and carries very little traffic other than a short haul from the Dragon Cement plant to a wharf in Rockland. Maybe CP will sell the line to the cement company and they can operate it themselves with a switcher or maybe it will be converted to trucks.
The amount of investment suggests something more than traffic growth of 2 or 3 percent a year, no?
I wonder if anybody is nervous about the future of the Orford Express tourist train. Is CP willing to let them operate on their line after STB approval? Is CP willing to discuss with Mr. Rebello’s project to run a passenger service between Montréal and Sherbrooke? I hope these two issues will be able to continue.