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12/4/2008



Rail News: M&A

Watco awaits STB ruling on Michigan short line venture


On March 1, 2009, the Watco Cos. Inc. might launch its 18th short line. That is, if the Surface Transportation Board (STB) approves Watco’s application to assume operation of a Norfolk Southern Railway line in Michigan and Indiana, and form Grand Elk Railroad L.L.C. as the line’s operator.

Watco filed the application with the STB on Nov. 3 and anticipates a ruling by Jan. 26. The short-line holding company plans to operate a 122.9-mile NS line running from Grand Rapids, Mich., to Elkhart, Ind.

The Grand Elk Railroad would serve more than 55 shippers in the two states. Watco projects annual carloads at 22,000, including automotive parts, plastics, metals, lumber and wood products, and aggregates traffic.

The Grand Elk Railroad would operate three yards along the line in Grand Rapids, Kalamazoo and Wyoming, Mich. The short line would interchange with NS in Kalamazoo and Elkhart, Canadian National Railway Co. in Kalamzoo and CSX Transportation in Grand Rapids. Grand Elk also would interchange with short lines Marquette Railroad, Mid-Michigan Railroad, Grand Rapids Eastern Railroad and Michigan Southern Railroad.

Watco plans to upgrade portions of the line between Elkhart and Grand Rapids to increase train speed from 10 mph to 25 mph.


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