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 Post subject: News from Hell
PostPosted: Mon Nov 09, 2015 6:35 pm 

Joined: Sun Aug 22, 2004 11:54 pm
Posts: 1730
As bad as this is on the steam front, really sucks to have written 80.50 calls against a stock that was 78 and change in the beginning of the day, and 88.5 at the end.

http://www.bloomberg.com/news/articles/ ... k-southern

If this goes through, we'll be putting the words about steam to a song that contains the line "the day the music died".


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 Post subject: Re: News from Hell
PostPosted: Mon Nov 09, 2015 6:54 pm 

Joined: Sun Aug 22, 2004 11:26 am
Posts: 3716
Location: Maine
I hear your pain, but perhaps it'll awaken the 2816 instead. Don't fear the unknown.

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 Post subject: Re: News from Hell
PostPosted: Mon Nov 09, 2015 7:00 pm 

Joined: Thu Oct 24, 2013 8:30 am
Posts: 84
this is scary talks for steam fans like me. But this is really a skeptic situation I mean CSX turned this down and so should NS. If the deal goes through Hunter Harrison will under attack by two countries and earning a reputation of a monopolist and the justice department from Canada and USA and the CPRR would be broken up or this possible merger could ruin the CP financially 9.9/10 mega mergers are a failure. So I think it's a loose loose loose situation for the CP and NS. Me personally I don't think it will happen Wick Mooreman is a proud guy the deal goes through the downhill slide for the CP begins but that's just me


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 Post subject: Re: News from Hell
PostPosted: Mon Nov 09, 2015 7:40 pm 

Joined: Fri Jul 23, 2010 12:41 pm
Posts: 377
Location: Minneapolis, MN
I suspect that this will be a very hard sell to the U.S. federal regulators. And who knows, Congress might even get involved if the other U.S. Class 1's lobby against it very much. Foreign ownership may be a problem for the feds.


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 Post subject: Re: News from Hell
PostPosted: Mon Nov 09, 2015 7:49 pm 

Joined: Wed Feb 02, 2011 9:40 pm
Posts: 709
hamster wrote:
I suspect that this will be a very hard sell to the U.S. federal regulators. And who knows, Congress might even get involved if the other U.S. Class 1's lobby against it very much. Foreign ownership may be a problem for the feds.


Then how did CN get by with buying IC, WC, B&LE, DM&IR, and EJ&E??


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 Post subject: Re: News from Hell
PostPosted: Mon Nov 09, 2015 8:37 pm 

Joined: Fri Apr 27, 2012 6:30 pm
Posts: 209
This move would make zero sense, since CP just sold NS half (?) the Delaware & Hudson. Frankly, if you ask me, this is just a ploy to raise stock prices for both companies, so we can sleep well knowing that 611, 4501, 765, and company will have rails to roam on in 2016.

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 Post subject: Re: News from Hell
PostPosted: Mon Nov 09, 2015 9:00 pm 

Joined: Sun Aug 22, 2004 11:54 pm
Posts: 1730
It may make zero sense to you, but the mere fact that NS has acknowledged it as possible was enough to drive up NS stock from 78 and change to 88 and change. I'm now not just in a short squeeze, but a short vice.


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 Post subject: Re: News from Hell
PostPosted: Mon Nov 09, 2015 10:09 pm 

Joined: Fri Feb 25, 2011 11:13 pm
Posts: 52
You can blame the Fed actually. They've held interest rates so cheaply that the Merger & Acquisition business is booming as there's plenty of cash looking for a home these days. Retired folks get punished, but Wall Street makes out again. Besides that, with the US Business tax rate is so out of whack it make sense for many companies to be bought by an outside the US owner. It may not make perfect RR sense, but it does make financial sense and that 's what drives the world these days. Expect a UP/CSX linkup to follow if this happens.


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 Post subject: Re: News from Hell...CP + NS = ?!?!?
PostPosted: Tue Nov 10, 2015 12:47 am 

Joined: Thu Feb 04, 2010 11:37 pm
Posts: 219
Location: Detroit, Michigan
Here we go again with CP Merger/Takeover talks. Last go around it was CP & CSXT. NOW it's CP & NS.

Once again, when it comes to any merger talks, commodities are the driving force behind any merger to occur right now.

Me thinking personally, it's around Big Oil especially Canadian Oil Sands. I'm under the impression these merger talks started after The U.S. President cancel the XL Pipeline Deal.

This little website might give you an idea where Canadian Oil might go, especially with a CP-NS Combo:

Oil Change International – Rail Map
http://priceofoil.org/rail-map/

Now near me, the railroad commodity near me which is the biggest is Automotive Parts & Automobiles for Detroit Metro Area. The Detroit Rail Market is 1 of 3 areas where areas where Conrail SA exists. The others being NYC/NJ & Phila/NJ. The reason Conrail was “Split” instead of totally out right “Merge/Taken Over” by either NS or CSX was to Preserve Competition. .

Conrail Detroit Share Asset Area
http://knorek.com/RR/SAA/SAAIndex.htm

Detroit is considered an International Gateway for transcontinental traffic, mostly Chicago <-> Montreal aka “Canadian Corridor”. CP Rail has trackage rights over Norfolk Southern in order to reach Chicago by way though Michigan and Indiana.

CP Trackage Rights On NS [CHI-DET/WIN-TOR-MON]
- Norfolk Southern: Chicago Line (NYC/LSMS), Butler Jct, & Wabash Line
- Conrail SA: Delray Jct., Detroit Line (NYC/LSMS), & Michigan Line (NYC/MCRR),
- Michigan Central Detroit River Tunnel to Windsor, Ontario, Canada.

CP Trains On NS Traffic Types [CHI-DET/WIN-TOR-MON]
- Manifest Freights
- Autoracks
- Grain
- Intermodal (Single & Doubles)
- Oil (Ethanol & Bakken Crude)

As far other railroads operations in Detroit Area usually barrow power on thru trains:

- UP, KCS, & FMX Pacer Stack Trains on CSX from Mexico
- BNSF Coal Trains on CN, CSX, & NS from the Power River Basin.

Here’s what I sort of cooked up after looking at the Trains Magazine merger article:

Railroad Mega Merger =

Canadian Pacific Question?

NS +

KCS +

UP +

- CSX +

- BNSF

KCS Question?

CP +

UP +

- CN +

- BNSF +

- CSX

- NS

Canadian National Question?

BNSF +

NS +

- CSX

- UP

- CP

East + West Combos

BNSF Question?

NS +

- CSX

Union Pacific Question?

CSX +

- NS

Trifecta Combos

BNSF+CN[KCS]+NS

CP[KCS]+CSX+UP[KCS]


Overall, like all mergers it might LOOK GOOD ON PAPER, but in reality the railroads customer base depending on who is will either benefit or suffer. That is the nature of business.

This could be a + or - for the 21st Century Steam Program.

The +:

- CPR, MILW, SOO, D&H Heritage Added (New H-Units?)
- More Steamers: CP 2317, CP 2816, CP 2860, CP 3716, MILW 261, SOO 1003, & SOO 2719
- More Places To Run Steam Excursions Both In US & CAN
- More Holiday Trains Specials For Both US & CAN

The -:

Newly formed company doesn't want anything to do with steam at all, basically H.H. kills the 21st Steam Program. Discards anything relating to past companies at Norfolk Southern kills the Heritage Unit Diesel Program. That EL H-Unit might end up being the last NS H-Unit.

Enjoy?! *_*

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 Post subject: Re: News from Hell
PostPosted: Tue Nov 10, 2015 1:09 am 

Joined: Sat Feb 02, 2013 10:18 pm
Posts: 59
mspetersen ---
You nailed it. The Fed is driving this.
All that seems to matter these days is stock
prices, and pleasing the big stockholders --
nothing else.

steamfan765 ---
Wick Moorman is no longer the CEO of NS.
He is still on the NS Board, but will retire from
that position at the end of this year. So -- I think
it is fair to say that he has little to say about this
possible merger.

Me? I detest these mergers, and would like to see
almost all of them reversed -- not just railroad mergers --
but, then, I am just an ordinary person, and -- like
everyone else like me -- of no importance to those
who make these decisions.

About the future of steam excursions on the NS --
A friend said long ago that people need to enjoy each
and every excursion, because every one could be
the last one for that locomotive.
So -- along those lines -- THANK you, EVERYONE in
NS, for greatly helping the 611 get restored, and
THANK you for letting her run again, AND for also
letting the 765 and 4501 and 630 run.


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 Post subject: Re: News from Hell
PostPosted: Tue Nov 10, 2015 1:20 am 

Joined: Wed Oct 22, 2008 8:18 pm
Posts: 2070
I tend to think monopoly laws may come into play here.

How much property do you think China owns in the US?


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 Post subject: Re: News from Hell
PostPosted: Tue Nov 10, 2015 7:24 am 

Joined: Thu May 24, 2012 1:37 pm
Posts: 895
I think a primary reasoning behind this is an 'inversion' similar to what's just happened with Burger King and Tim Horton.

Very probable a secondary reason is to whack the day traders and make some short-term profits, the way Soros did with coal a few weeks ago.

Any perceived 'halo effect' from EHH being in charge won't survive to merger. He's 71 now, for heaven's sake. And I doubt CP has anyone in his league to take over effective management of the merged entity if it goes through.

The more interesting discussion: With traffic falling, does that decrease the effect of running steam on the main lines, or increase the desire to keep steam 'out of the way' of the trains that are left?

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 Post subject: Re: News from Hell
PostPosted: Tue Nov 10, 2015 9:16 am 

Joined: Mon Aug 30, 2010 9:22 pm
Posts: 67
[quote="Overmod"]

Any perceived 'halo effect' from EHH being in charge won't survive to merger. He's 71 now, for heaven's sake. And I doubt CP has anyone in his league to take over effective management of the merged entity if it goes through.

Don't forget about Keith Creel - who defected from CN to CP in order to follow Harrison, who it also turns out is his father in law... Apples like that can't fall far from the tree...


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 Post subject: Re: News from Hell
PostPosted: Tue Nov 10, 2015 11:07 am 

Joined: Sun Aug 22, 2004 11:54 pm
Posts: 1730
Ladies and Gents:

A little reminder about profit. Keep in mind a railroad is a business designed to make money, not to run trains. Managers have a LEGAL RESPONSIBILITY to maximize shareholder value. If you don't think so, that's fine, but don't whine when the investments in your 401k or Scottrade account aren't performing.

Now, discussions about the Fed and other political issues aside, what is relevant to preservation is that we have the potential to see an extraordinarily steam and preservation road friendly road gobbled up by a foreign road that has no use for steam, public excursions, heritage units or special moves-and as far as the pursuit of profit goes, I thought we were done with Calgary on September 18. I guess not.

As a stockholder (assuming I don't get called), I have no interest in this deal, no matter what the price. CP is fat with cash, but I think there are diseconomies of scale and adverse regulatory action as potential perils of such a deal, not to mention the normal issues with culture clash and IT systems integration.

Post Script: I just reviewed some basic financials. CP's price has fallen from 212 to 140 and the market cap is now 21B, whereas NS shares went from 117 to 72 (now 85) and market cap is 25B.


Last edited by superheater on Tue Nov 10, 2015 12:01 pm, edited 2 times in total.

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 Post subject: Re: News from Hell
PostPosted: Tue Nov 10, 2015 11:14 am 

Joined: Wed Oct 22, 2008 8:18 pm
Posts: 2070
several eastern states adopted policies to promote railroad heritage, its a clear statement about the railroad history in the regions.


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