Canadian railway CN (NYSE: CNI) and short line operator Watco have agreed to allow Watco to take over the freight operations at one of CN’s passageways between the U.S.-Canadian border.
CN will sell to Watco its noncore lines and assets that are on the Soo division, which consists of approximately 250 miles of track and runs from Sault Ste. Marie to Oba, Ontario. The sale also consists of approximately 650 miles of branch lines of the Wisconsin Central in Wisconsin and Michigan. The Wisconsin Central was a CN subsidiary.
CN started the process to sell these noncore assets and lines in July 2020, and Tuesday’s announcement acknowledges the conclusion of that process, CN said.
The terms weren’t disclosed and the acquisition is pending regulatory approval by the Surface Transportation Board.
In Ontario, Watco will continue freight operations as well as the Agawa Canyon Train Tour, CN said. Watco has also signed a memorandum of understanding with the Missanabie Cree First Nation regarding partnership opportunities for the Algoma Central Railway, the railway said.
Meanwhile, in the U.S. and Ontario, the lines will remain connected to CN’s tri-coastal network and CN “will continue to play a central role” in those segments, CN said.
Indeed, CN plans to maintain its presence in the Upper Midwest, saying last December that it would be opening an inland distribution terminal in New Richmond, Wisconsin. The facility, which recently opened, has an automotive compound for finished vehicles, as well as an intermodal terminal for shippers and receivers of greater Minneapolis and St. Paul, Minnesota.
CN expects to release its financial results for the first quarter of 2021 on April 26.
Subscribe to FreightWaves’ e-newsletters and get the latest insights on freight right in your inbox.
Click here for more FreightWaves articles by Joanna Marsh.
Related articles:
February another record month for CN grain shipments
CN cautious about Q1 but bullish about 2H
CN eyes opportunities in Upper Midwest with new inland terminal
Brokerage Compliance Symposium
The day before F3. Every compliance issue you face - fraud exposure, carrier liability, FMCSA rules, cargo theft, insurance gaps - navigated by attorneys and operators defining best practices in a changing industry.
F3 Awards Dinner
The night before F3. FreightTech100 companies honored. FreightTech 25 and Shipper of Choice winners revealed live. Cocktail reception into dinner and live music - 300 industry leaders in one purpose-built room.
F3: Future of Freight Festival
Industry-defining keynotes, rapid-fire technology demos, and industry leaders networking in experiences across Chattanooga - plus the inaugural F3 Awards Dinner featuring the FreightTech and Shipper of Choice reveals.
The day before F3. Every compliance issue you face - fraud exposure, carrier liability, FMCSA rules, cargo theft, insurance gaps - navigated by attorneys and operators defining best practices in a changing industry.
The Signal at Chattanooga Choo Choo • Chattanooga, TN Register NowThe night before F3. FreightTech100 companies honored. FreightTech 25 and Shipper of Choice winners revealed live. Cocktail reception into dinner and live music - 300 industry leaders in one purpose-built room.
The Signal at Chattanooga Choo Choo • Chattanooga, TN Register NowIndustry-defining keynotes, rapid-fire technology demos, and industry leaders networking in experiences across Chattanooga - plus the inaugural F3 Awards Dinner featuring the FreightTech and Shipper of Choice reveals.
The Signal at Chattanooga Choo Choo • Chattanooga, TN Register Now