MONTREAL — Canadian National Railway will acquire Iowa Northern Railway, which operates approximately 253 route-miles and 275 track-miles, primarily between Cedar Rapids and Manly, Iowa, CN announced today.
Iowa Northern was founded in 1984 on a portion of the former Chicago, Rock Island & Pacific. The Class III short line serves 19 counties in eastern Iowa, has 110 employees, 24 locomotives (plus six slugs), and 450 freight cars (all covered grain hoppers), according to the railroad’s website. It serves 20 grain elevators, two ethanol plants, and two mineral processing facilities, and handles other commodities including fertilizer, food, farm machinery, chemicals and lumber. The railroad hands more than 60,000 cars per year.
CN and Iowa Northern intersect in Cedar Falls, Iowa. Iowa Northern also interchanges with Union Pacific, Canadian Pacific, and the Cedar Rapids & Iowa City (or CRANDIC) Railway.
“We are delighted to have reached an agreement with Iowa Northern Railway,” CN CEO Tracy Robinson said in a statement. “We look forward to the opportunities our combined network will provide customers, farmers, and our partners to respond to the needs of their existing and new markets. By enabling all of us to play an even more important role in this critical supply chain and densifying our southern network, we are accelerating sustainable, profitable growth.”
The companies said the transaction represents an opportunity to support the growth of local businesses by creating single-line service to North American destinations while preserving access to existing carrier options.
“We are very pleased to have reached a deal with CN,” said Iowa Northern Chairman Daniel Sabin. “We believe CN shares IANR’s commitment to local stakeholders and that this transaction will be beneficial for customers, employees and the local Iowa economy. We are confident that, as part of CN, IANR will be able to continue to provide reliable first and last mile service to our local customers while providing them access to a much broader network and market.”
CN said the deal has closed into an independent voting trust pending regulatory review by the Surface Transportation Board. Terms were not disclosed. An STB decision is expected in 2024.
Mr Hergert, you are correct. The Cedar Falls-Oelwein segment is ex-CGW, one of the few remaining pieces of the Great Western still extant. At one point, that line went through Marshalltown, Des Moines, and St. Joseph, Missouri, on its way to Kansas City, and the Marshalltown-KC segment was a main line until the mid-80s, last used by CNW, who bought the Chicago Great Western in 1968. That purchase was basically the CNW buying out & eliminating a competitor, as they paralleled each other quite a bit, and the CNW had far superior routes & grades, so they abandoned the vast majority of the smaller granger road. The STB should block this purchase on similar grounds.
I doubt CN has the same commitment to the local stakeholders. If I was a small shipper on the IANR I would be afraid if I wanted to keep using rail. Dan Sabin and crew looked for ways to expand and gain business. The Forest City to Belmond line is an example. I would expect CN will jettison that line.
I believe UP still owns a segment of the old CGW in the Waterloo area. A few years ago, they contracted out the operation and maintenance to IANR. If that arrangement is still in place, I wonder if UP will end it.
I agree 100%. Time and time again, the Class I’s, and I feel especially CN, have shown they don’t give a rip about them.
I grew up in WI and seeing what CN did to the WC lines other than Duluth to Chicago for the most part is so sad and frustrating.
No providing details on the value of the deal yet.
Dr. Güntürk Üstün
I meant CN.
IANR parallels VN for almost its entire route. This should not be allowed.
Union Pacific interchange will dry up, I expect. UP won’t be happy.
Why? IANR is a rounding error on CN’s books. Need more traffic to prop up the Iowa Division? Or was their staff at or near retirement?
Defensive move? At the moment, I don’t have time to look at detailed maps, but could CN see this as a possible puzzle piece for CPKC to build a shortcut between Minneapolis and Kansas City?
Like Andy, my first thought was this could be CPKC related. CN got denied the Springfield line in IL, so maybe they feel they still need to make a move of some sort.