Matt Rose at BNSF has stated publicly that if the CP-NS merger moves forward then BNSF would enter the fray, so to speak. However, what that specifically entails could really be just about anything. It could be as an intervenor or “co-buyer” in the CP-NS transaction, much like NS intervened in the original CSX-Conrail merger proposal to divide the property. It could be a higher offer than CP’s for the whole NS property.
Or perhaps the BNSF move could be to make sure they don’t get aced out of ownership in the Eastern US by proposing their own merger with CSX.
This discussion topic is not to discuss the merits of CP-NS, but rather to have a discussion as to which Eastern US property would meld better with BNSF if the balloon goes up.
There are some interesting possibilities if BNSF would choose a CSX merger as their reaction to CP-NS.
BNSF utilizes CSX from Birmingham to Atlanta already for its substantial Southern California-Atlanta intermodal traffic.
BNSF’s former Frisco and its connection with the CSX former Big Four at St. Louis might take on added importance as the most direct route to Indianapolis, Louisville and Cincinnati for traffic to and from the Southwest and West Coast. It could become a de facto bypass of Chicago similar to the NS-owned former Wabash.
The Frisco and its connection at Memphis with the former Nashville, Chattanooga & St. Louis would be the most direct route for traffic to and from the Southwest and West Coast to Nashville.
In New Orleans, BNSF’s connection to the former Louisville & Nashville would allow Texas and Louisiana Chemical Coast traffic to take the most direct route to the Southeast and the Northeast.
In Illinois, CSX already has trackage rights on the NS-owned Kankakee Belt at Streator.
BNSF traffic on the former ATSF could be diverted around Chicago at Streator on the Kankakee Belt and at Joliet on the former Rock Island. BNSF traffic on the CB&Q could also
Uncle Warren certainly has enough money to make things interesting.
A CP/NS union would likely entail a significant chunk of CP stock going to NS shareholders in exchange for their NS holdings. I’m wondering if Berkshire could buy a large enough chunk of both CP AND NS up front such that a subsequent CP-NS merger would give Berkshire effective control of the whole enchilada?
Nice little ‘poison pill’ strategy if it could work.
I’ve been reading in that Bill Brosnan book about how N&W manipulated the corporate structure in it’s union with Southern effectively making Southern the subordinate member.
BH may have enough cash in their slush fund to do that, but didn’t they have to divest themselves of some other rail stock before the BN/SF merger could be approved?
From what I have read on the CP/NS merger thread, as of the end of the year Burkshire Hathaway had $68 billion dollars in cash. More than enought to stir the CP/NS pot. An interesting possiblity from the maps that I have looked at is a BNSF/NS merger. Similar results from the just discussed BNSF/CSX merger. ST Louis, Kansas City, Streeter, New Orleans and Memphis for end to end BNSF west coast through to NS east coast points.
All of the arm chair railroad experts that want to do away with NS could do away with so much NS has done for the pubic. All the steam including 611 with the history presented to us. Without NS efforts, there will be a large hole appear in this efforts. The new money first will look at these great actions as a place to save money. Spenser shops does give a view of our railroad history, but is not a help on return on investment. Heads up from Joe in Myrtle Beach,SC