In a surprise move on December 20, Canadian National Railways and Burlington Northern Santa Fe announced both companies would merge to create a new venture, North American Railways, Inc., to be based in Montreal. North American will become the parent company of BNSF in what is quirkily described as the "companion company" of CN.
The two railroads currently operate about 50,000 route-miles of track; employ about 67,000 people and have combined annualrevenues of approximately $12.5 billion. The new network will be the largest railroad on the continent.
In a joint statement, CN president Paul Tellier and Robert Krebs, chairman and CEO of BNSF said, "This is a new railroad for a new era. We are bringing together two highly successful railroads that share a common vision about their role in the future - to increase revenues and earnings through superior customer service."
Following the announcement, the Surface Transportation Board put both railroads on notice saying it would scrutinize the proposal of combining the railroads under a joint Canadian company. CN recently completed its purchase of Illinois Central. |