Canadian Pacific announced on Monday, Nov. 17, 2014 it would sell a line of roughly 200 miles, cutting across Pennsylvania and New York, to Norfolk Southern Corp. for $192.6 million.
The transaction is subject to approval by the Surface Transportation Board (STB).
NS would acquire right-of-way operated by CP subsidiary Delaware & Hudson Railway linking Sunbury, Pa., and Schenectady, N.Y., running in a rough "S" shape route north from Sunbury through Scranton, Pa., Binghamton, N.Y., and Oneonta, N.Y. before reaching Schenectady.
The route provides a direct link to existing NS operations as well as direct access from Chicago and the U.S. Southeast to Albany, N.Y., and vicinity, including the recently opened intermodal terminal in Mechanicsville, N.Y., which Norfolk Southern would access from Schenectady via trackage rights over a stretch of the D&H CP has not put up for sale.
The purchase also gives Norfolk Southern improved access to New England markets, served by its joint venture subsidiary Pan Am Southern.
The CP sale includes D&H's freight maintenance facility at Binghamton, N.Y., near the Pennsylvania-New York border, along with other facilities along the route. NS will also hire the 150 D&H employees in the area affected by the purchase.
"As we have stated in recent months, we've been in the process of negotiating the final details for the potential sale of the southern portion of our D&H line," CP CEO Hunter Harrison said in a statement. "We are pleased to find a prospective buyer in Norfolk Southern."
"Acquiring this portion of the D&H provides for a more efficient rail transportation system by consolidating freight operations with a single carrier," Norfolk Southern CEO Wick Moorman said.