Mongeau: Rail merger likely to trigger others

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MONTREAL – Railroad mergers and acquisitions are the hot-button topic in the transportation industry this month, and even railroads outside the rumors are fielding questions about the likelihood of such a combination.

During Canadian National's third quarter earnings call on Tuesday, CN President and CEO Claude Mongeau said, "I believe it would likely start with the four (railroads) in the U.S. going down to two." Mongeau stressed that his comments are based on a hypothetical merger merger occurring first in the industry.

The comments came in answer to questions by BMO Capital Markets analyst Fadi Chamoun.

He added that CN believes "the ability to provide service, the ability to grow organically, the ability to unfold an agenda of supply chain collaboration and create end-to-end service that will allow secular shift(s) of growth ahead of inflation, and solid pricing in the industry is the best going forward strategy."

Mongeau also noted that CN would not comment on other railroads' strategies, including possible mergers.

NEWSWIRETrains News Wire

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