Canadian National to purchase short line Iowa Northern
Deal is the latest in a series of Class I acquisitions of smaller railroads over the last five years
CANADIAN NATIONAL WILL ACQUIRE the 253mile Iowa Northern Railway, the companies announced on Dec. 6.
The Iowa Northern, founded in 1984 to operate former Chicago, Rock Island & Pacific trackage, is a short line rags-toriches story. The current ownership group, headed by second-generation railroader Dan Sabin, took over in 1994, when the Iowa Northern handled 15,000 cars per year on rickety 10-mph track. Today it handles more than 60,000 cars a year and the railroad has invested millions of dollars to bring the track into a state of good repair.
The railroad has 110 employees and a fleet of 24 locomotives, plus six slugs.
“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,” Sabin said in a statement. Terms of the transaction were not disclosed. The deal will require Surface Transportation Board approval.
CN says the short line’s customers will benefit from single-line service to points on its 19,200-mile network, as well as retain their options to connect with Union Pacific, Canadian Pacific Kansas City, and Iowa Interstate.
CN’s Iowa Northern deal is the sixth time since 2020 that a Class I has acquired a short line or regional railroad. There’s not necessarily a common thread among transactions that include: Canadian Pacific acquiring Central Maine & Quebec, 2020; CSX adding Pan Am Railways, 2022; BNSF Railway buying out the lease for Montana Rail Link, 2024; Canadian Pacific Kansas City and CSX acquiring Meridian & Bigbee, expected in 2024; CN taking a stake in the Cape Breton & Central Nova Scotia Railway, 2023; and now CN and Iowa Northern. — Bill Stephens