| Pan Am Systems | |
| Former Name: | Guilford Transportation Industries |
| Type: | Private |
| Foundation: | 1998 |
| Founder: | Timothy Mellon |
| Location City: | Portsmouth, New Hampshire |
| Location Country: | United States of America |
| Industry: | rail transport manufacturing and energy transportation related brands real estate |
| Fate: | Acquired by CSX Corporation |
| Subsid: |
|
Pan Am Systems was a privately held Portsmouth, New Hampshire-based[1] Florida corporation composed of rail transport, manufacturing and energy, transportation related brands, and real estate divisions.[2] It formerly held a now-defunct airline division.
Pan Am Systems was put up for sale in July 2020.[3] On November 30, 2020, CSX Corporation announced that it had signed a definitive agreement to purchase Pan Am Systems. The sale of Pan Am Systems to CSX underwent regulatory review by the Surface Transportation Board,[4] [5] which approved the sale on April 14, 2022.[6] At midnight on June 1, 2022, CSX began operating Pan Am Systems and its Pan Am Railways; also, Pan Am Systems was merged into a temporary subsidiary of CSX which will eventually merge into CSX.
Guilford Transportation Industries (GTI) was formed in 1981. GTI entered the railroad business in 1981 with its purchase of the Maine Central Railroad Company from U.S. Filter Corporation. This was followed by its 1983 purchase of the Boston & Maine Railroad, and in 1984 it purchased the Delaware and Hudson Railway (D&H). In 1988, GTI declared D&H bankrupt. D&H employees took it over, with the New York, Susquehanna & Western Railway managing it. The employees then sold out in 1991 to the Canadian Pacific Railway.
GTI purchased the name, colors, and logo of Pan American World Airways in 1998 and Pan Am Systems was established that same year. In March 2006, GTI changed its name to Pan Am Railways.
The company was privately owned by Timothy Mellon, an heir to the Mellon banking fortune, and several other stakeholders including former Penn Central employee David Fink and son David A. Fink.
In July 2020, Pan Am Systems was put up for sale.[3] On November 30, 2020, an agreement was announced for CSX Corporation (parent company for CSX Transportation) to acquire Pan Am Systems. Norfolk Southern expressed concern about possible impacts on competition. The sale was proposed as follows: CSX will own and operate between Mattawamkeag, ME and Ayer, MA. Between Ayer and Rotterdam, NY, Genesee and Wyoming Rail will be the operating party. This means the track will be owned by CSX, but CSX will not dispatch it. Also, Norfolk Southern will keep its 49% stake in Pan Am Southern (PAS). With the sale, the intermodal traffic between Mechanicville and Ayer will be re-routed over the B&A to Worcester, MA. From there the traffic will come up the Worcester main and into Ayer Yard.[7]
On March 25, 2021, after numerous letters questioning CSX's acquisition of Pan Am Railways parent Pan Am Systems from the Massachusetts Bay Transportation Authority, the Massachusetts Department of Transportation, the Commonwealth of Massachusetts, Vermont Rail System, as well as many other local political figures and community leaders from other New England states, the Surface Transportation Board ruled the acquisition as "Significant" meaning that a more rigorous review process would be necessary.[8]
On April 30, 2021, CSX submitted a 478-page plan of purchase outlining a broad range of topics, from implementations of track upgrades to the controversial issue of Norfolk Southern intermodal routing, as well as the fate of Pan Am's hodgepodge fleet of aging motive power, which is made up of EMD and GE locomotives from railroads such as Conrail, NS, CSX, the Milwaukee Road, and Kansas City Southern.[9]
On May 26, 2021, the federal regulators of the Surface Transportation Board rejected CSX's purchase application, deeming it "incomplete." The board cited "contradictions" and "lack of necessary information" to properly judge the acquisition, and therefore could not rule on the matter. While CSX has the option of re-submitting a revised application, which it has motioned toward in its official statement, the transaction stands on uncertain ground.[10] [11]
On July 30, 2021, the Surface Transportation Board accepted a revised merger application for consideration, allowing CSX to move forward with the acquisition on Pan Am Systems. The decision determined that an environmental and historic review are unnecessary and establishes criteria for additional filings, public comments, and a deadline for a final Surface Transportation Board decision.[12] [13]
The STB approved the sale of Pan Am Systems to CSX on April 14, 2022,[14] for $600 million.[15] At midnight on June 1, 2022, CSX began operating Pan Am Railways and Pan Am Systems was merged into a temporary subsidiary of CSX called 747 Merger Sub 2 which will become the new Pan Am Systems, the new Pan Am Systems and Pan Am Railways will eventually merge into CSX.