G&M: New VRS Entity To Supersede NEGS

VRS Network Parent Trans Rail Holding Co., Files With STB To Acquire NEGS Assets, And Rename It As Merrimack & Grafton Railroad Corp.

21 May, Burlington VT – Trans Rail Holding Company (TRH), the recently-coined parent company of Vermont Rail System (VRS), has filed notice with the STB to use the name Merrimack & Grafton Railroad Corporation (MGRC, or M&G) to acquire the New England Southern Railroad (NEGS) property and rights.

TRH was formed in March by the VRS ownership, and filed with the STB to control the VRS properties. The filing asserts that the transaction falls within the class of transactions described under 49 C.F.R. § 1180.2(d)(2), and is exempt from prior approval by the STB.

TRH and NEGS agreed on 30.April to acquire the latter’s principal business assets.
NEGS is the designated operator of the ~73-mile long stretch on the former B&M White Mountain Branch between MP P 21.30 at Lincoln NH to MP C 0.58 at Concord.
The rail lines are owned by the State of New Hampshire. NEGS has provided common carrier rail operations over the Line since 1982, and since 2012 under the existing operating agreement with NHDOT.
TRH has filed with the STB to recognize Merrimack & Grafton RR Corp., as the entity acquiring, and eventually operating the NEGS assets.

NEGS still has legs

NEGS will remain an independent Class III rail carrier after the transaction is closed. M&G has filed a separate notice of exemption in STB Docket No. FD 36405 pursuant to 49 C.F.R. § 1150.31 (a)(3) to become the new operator of the line.

Once the (expected) exemption is granted by the Board, NEGS will assign all of its rights and obligations under the Operating Agreement to the M&G, which will become a Class III carrier, supplanting NEGS. Until then, M&G exists as a non-carrier subsidiary formed by TRH for the purpose of becoming the new designated operator of the line. Prior to the commencement of M&G service, TRH and M&G must also obtain NHDOT consent to the reassignment of the Operating Agreement.

The requested decision will allow TRH to have continued control of its subsidiary M&G to assist the latter in replacing NEGS as the operator of the Line in order to ensure freight rail operations and service to rail shippers continue on this rail line for State of New Hampshire.

Just to be clear

In the filing, TRH notes that the rail line being acquired does not directly connect with any of the other five railroads controlled by TRH, and that the transaction is not part of a series of anticipated transactions that would connect the Line to any of the tracks of the other railroads.