Ulrich A merger would likely be his end game; however, I doubt now that a Canadian road would be his primary merger target. A merger, if one is going to happen, would likely involve CSX and UP or BNSF.
A merger would likely be his end game; however, I doubt now that a Canadian road would be his primary merger target. A merger, if one is going to happen, would likely involve CSX and UP or BNSF.
I suspect UP might be a more plausible takeover target for Team EHH...
A CSX-BNSF merger is unlikely unless Warren Buffet could be convinced of it's value. I don't know that a group could buy enough Berkshire Hathaway stock to gain a controlling interest and it would be folly to attempt to do it merely to get control of BNSF.
Of course if there was a CSX-UP merger BH/BNSF would have to immediately begin merger proceedings with Norfolk Southern..
"I Often Dream of Trains"-From the Album of the Same Name by Robyn Hitchcock
The market cap of Berkshire is more than $400 billion. That's really serious money, and any hedge fund would find themselves out of their depth in considering it. On the other hand, UP is a mere $80 billion or so. Even when you control CSX with their $40 bil cap, making a run at UP seems like a stretch.
I've always heard that UP would go after CSX. Even years before I hired out.
A coworker, now retired, was involved with a meeting that included then CEO, the late Jim Young. During a break, the question of future mergers came up. Mr. Young said when the final round happened, UP would go after CSX. The time (at that time) however wasn't right. Whether this still holds true is only speculation on my part.
I actually think the railroad merger scene is like a junior high dance. Everyone knows who they want to dance with but no one wants to be the first to ask.
I've heard second hand from a couple of different sources that within the last year or so UP was worried that they were the target of a hostile takeover. I think it was fended off for now.
Jeff
Yup.. sounds about right..EHH is not afraid to be rebuffed, and that's a great strength to have.
csxns BaltACD just abandon all of CSX Better yet just abandon all the american railroads and put it all on the interstates.
BaltACD just abandon all of CSX
Better yet just abandon all the american railroads and put it all on the interstates.
More constructively, if CSX is to go sell ex-CSX routes to UP and BNSF to give them direct access to the north-east U.S. megalopolis; to KCS to enable it to reach northern states and Canada; and perhaps to CP so it can provide service to southern and south-eastern US. This would help to remove the Chicago bottleneck, speed up freight services between major centres of population, enable more consignments to be handled by just one operator and though there would be one less Class 1, potentially at least increase competition. As the focus of rail freight shifts away from coal and towards intermodal long, uninterrupted journeys will become increasingly important to ensure effective competition with other modes.
How CSX would be dismembered and its routes incorporated into other Class 1s as described above is another matter - it would almost certainly require government action.
PNWRMNM CMStPnP PNWRMNM St. Paul, Do you have a credible source for this claim? Mac Put your Mouse over the NEWS menu at the top of this page and read the article next to the Hunter Harrison extended gut.........I mean photo. Thank you, and Convicted One. Your headline is third hand and unfortunately the source you copied it from, Bill Stevens, inverted the cause and effect, or the horse and the cart if you prefer. The investor group/hedge fund Mantle Ridge is the entity that is driving the process and has presumably hired Harrison as their railroad expert/boogyman. Mantle wants three (of 12) seats on the CSX board. Harrison is one of the tools in Mantle Ridge's tool box. The point is this is not Harrison's doing as your and Stevens' headline implies. I believe Harrison runs a large risk of ending up with egg on his face if Mantle Ridge succeds and installs him as CEO. The current management at CSX has already bogged it down with monster trains on 28 hour "day" cycles. The big train strategy can go only so far and I believe CSX has gone as far as it can, and perhaps too far. Service reliability still counts for carload traffic which means getting trains in and out of yards on time. If Harrison continues down the big train road I fear quality will suffer more than it already has driving additional traffic to the highway and depressing earnings. Of course he could surprise us all and go to somewhat shorter trains on a 24 hour or less cycle. With the current traffic downturn there is relatively more main line capacity to support that strategy. Bring popcorn! Mac
CMStPnP PNWRMNM St. Paul, Do you have a credible source for this claim? Mac Put your Mouse over the NEWS menu at the top of this page and read the article next to the Hunter Harrison extended gut.........I mean photo.
PNWRMNM St. Paul, Do you have a credible source for this claim? Mac
St. Paul,
Do you have a credible source for this claim?
Mac
Put your Mouse over the NEWS menu at the top of this page and read the article next to the Hunter Harrison extended gut.........I mean photo.
Thank you, and Convicted One.
Your headline is third hand and unfortunately the source you copied it from, Bill Stevens, inverted the cause and effect, or the horse and the cart if you prefer. The investor group/hedge fund Mantle Ridge is the entity that is driving the process and has presumably hired Harrison as their railroad expert/boogyman. Mantle wants three (of 12) seats on the CSX board. Harrison is one of the tools in Mantle Ridge's tool box. The point is this is not Harrison's doing as your and Stevens' headline implies.
I believe Harrison runs a large risk of ending up with egg on his face if Mantle Ridge succeds and installs him as CEO. The current management at CSX has already bogged it down with monster trains on 28 hour "day" cycles. The big train strategy can go only so far and I believe CSX has gone as far as it can, and perhaps too far. Service reliability still counts for carload traffic which means getting trains in and out of yards on time. If Harrison continues down the big train road I fear quality will suffer more than it already has driving additional traffic to the highway and depressing earnings.
Of course he could surprise us all and go to somewhat shorter trains on a 24 hour or less cycle. With the current traffic downturn there is relatively more main line capacity to support that strategy.
Bring popcorn!
I watch all these "super" trains and laugh. Already had several derailments due to the increased length and tonnage of trains and they'll probably want to make them longer and furlough more.
Right now on my stretch of railroad, they're consistently running trains 12-14,000ft long and the longest siding on the 100 mile journey is 10,000ft. There is double track that extends 11 miles South from the north end point, and a double track "island" 25 miles South of the north end point as well. All meaning trains have to travel 75 miles or 25 miles just to pass another train.
All this is meaning, crews are called on their rest to go babysit trains in hopes of moving them further and many times never turning a wheel. Oh and because of the deep furloughs, crews are hard to come by as well.
All self-inflicted....
Excerpt from The Globe and Mail, Feb. 10
CSX Corp. has extended the deadline to nominate directors as the Florida-based railway negotiates with an activist investor and Hunter Harrison over boardroom representation.
CSX said on Friday the Feb. 10 deadline for board members nominations has been moved to Feb. 24, ahead of the annual meeting vote, a date for which has not been set. Paul Hilal’s Mantle Ridge fund has been in talks with CSX about installing Mr. Harrison as chief executive officer. The talks have reportedly been hung up over how many boardroom seat nominations Mantle Ridge will be offered.
https://news.google.com/news/story?ncl=dyRafIS7I5UKdPMHwDyGmLl-yR0WM&q=%22hunter+harrison%22&lr=English&hl=en&sa=X&ved=0ahUKEwj8y5iNh4bSAhVr44MKHdkrBpYQqgIIHzAA
Morningstar article from Dow Jones (Wall Street Journal), Feb. 16
http://news.morningstar.com/all/dow-jones/us-markets/2017021615907/railroad-executive-hunter-harrison-frustrated-by-csx-board-activist-partner-2nd-update.aspx
Mantle Ridge (Paul Hilal) letter to CSX, Feb. 16
http://www.businesswire.com/news/home/20170216006383/en/Mantle-Ridge-Sends-Letter-CSX-Board
CSX press release, Feb. 14
https://www.csx.com/index.cfm/about-us/media/press-releases/csx-calls-special-meeting-in-light-of-extraordinary-mantle-ridge-and-hunter-harrison-requests/
Excerpt from Associated Press, Feb. 22
CSX Corp. has extended its deadline for board nominations a second time as the railroad faces pressure from a hedge fund that wants to install a new CEO.
The Jacksonville, Florida-based railroad said Wednesday that its deadline for nominations has been extended to March 10.
That suggests the railroad may be continuing discussions with Paul Hilal's Mantle Ridge hedge fund and wants more time.
News Wire: CSX again buys more time to reach deal with Harrison, hedge fund
Railroad’s board extends deadline for board nominations to March 10
http://trn.trains.com/news/news-wire/2017/02/23-csx-deadline-ext
Brian Schmidt, Editor, Classic Trains magazine
It may be that the reason the CSX board has moved the deadline back twice is that they have a real fear that Mantle Ridge will win the shareholders' vote. They may want more time to organize their opposition.
Good luck.
If a pension fund is invested in CSX it will be hard for that fund to vote its shares against Mantle Ridge. The fund managers have a legal responsibility to maximize the value of the pension fund.
Mantel Ridge gets mrukier and murkier -
https://www.bloomberg.com/gadfly/articles/2017-02-23/csx-activist-may-undercut-own-message-with-pay-demands?cmpid=yhoo.headline
Never too old to have a happy childhood!
kgbw49 Potential disposition via short line lease or abandonment: B&O between Seymour IN and St. Louis B&O west of Cumberland MD through WV Clinchfield All coal branches in KY, VA or WV Mobile AL to Tallahassee FL Atlanta GA to Augusta GA Major downgrade - C & O from Cincinnati OH to Newport News VA
Potential disposition via short line lease or abandonment:
B&O between Seymour IN and St. Louis
B&O west of Cumberland MD through WV
Clinchfield
All coal branches in KY, VA or WV
Mobile AL to Tallahassee FL
Atlanta GA to Augusta GA
Major downgrade - C & O from Cincinnati OH to Newport News VA
I would add the "Bow Line" between Valdosta and Waycross, GA. It's all but 2 or 3 miles of the 4th longest stretch of absolutely straight track in the U.S., but in 60 miles there is only one active customer, as far as I can see.
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