TORONTO, April 8 /CNW Telbec/ - GO Transit and CN (TSX: CNR)(NYSE: CNI)
announced today that the Toronto area commuter rail agency will acquire CN's
Weston Subdivision for expanded GO service between Union Station and regions
northwest of the city.
This strategically important rail line runs from a point near Strachan
Avenue and Wellington Street West in downtown Toronto, northwest through the
city to CN's main east-west freight line near the intersection of Steeles
Avenue and Bramalea Road. The purchase is valued at C$160 million.
GO currently runs its Georgetown commuter rail service over the line,
which also accommodates VIA Rail trains running between Toronto, Kitchener,
and other points in southwestern Ontario. In total, the two passenger carriers
operate 46 trains per day over the line, while CN operates three daily local
freight trains along this corridor.
Under its agreement with GO Transit, CN will continue to serve its
freight customers on the Weston Subdivision. VIA will also continue to operate
trains on the line.
By owning the Georgetown rail corridor, GO is better positioned to add
more service, build new infrastructure, and expand its operations along that
line. This acquisition aligns with GO Transit's Strategic Plan, GO 2020.
"This is a major step forward for future growth and expansion along this
already busy corridor," said GO Transit Chairman Peter Smith. "This purchase
sets the framework for future GO rail corridor purchases, and we look forward
to continuing our strong, long-standing partnership with CN."
Claude Mongeau, CN executive vice-president and chief financial officer,
said: "CN is pleased to have reached this line-sale agreement with GO Transit.
GO is a valuable CN customer - the vast majority of its services in the
Greater Toronto Area operate over CN's rail network - and we believe this
transaction and our continuing partnership with GO will help to advance
commuter rail and its clear environmental benefits to the Toronto region. At
the same time, our line sale - reflecting CN's tight focus on asset management
- will also generate value for the company."
This news release contains forward-looking statements. CN cautions that,
by their nature, forward-looking statements involve risk, uncertainties and
assumptions. Implicit in these statements, particularly in respect of
long-term growth opportunities, is the Company's assumption that such growth
opportunities are less affected by the current situation in the North American
and global economies. The Company cautions that its assumptions may not
materialize and that current economic conditions render such assumptions,
although reasonable at the time they were made, subject to greater
uncertainty. The current situation in financial markets is adding a
substantial amount of risk to the North American economy, which is already in
a recession, and to the global economy, which is significantly slowing down.
The Company cautions that its results could differ materially from those
expressed or implied in such forward-looking statements. Important factors
that could cause such differences include, but are not limited to, industry
competition, legislative and/or regulatory developments, compliance with
environmental laws and regulations, various events which could disrupt
operations, including natural events such as severe weather, droughts, floods
and earthquakes, the effects of adverse general economic and business
conditions, inflation, currency fluctuations, changes in fuel prices, labour
disruptions, environmental claims, investigations or proceedings, other types
of claims and litigation, and other risks detailed from time to time in
reports filed by CN with securities regulators in Canada and the United
States. Reference should be made to "Management's Discussion and Analysis" in
CN's annual and interim reports and Annual Information Form and Form 40-F
filed with Canadian and U.S. securities regulators, available on CN's website,
for a summary of major risks.
CN - Canadian National Railway Company and its operating railway
subsidiaries - spans Canada and mid-America, from the Atlantic and Pacific
oceans to the Gulf of Mexico, serving the ports of Vancouver, Prince Rupert,
B.C., Montreal, Halifax, New Orleans, and Mobile, Ala., and the key
metropolitan areas of Toronto, Buffalo, Chicago, Detroit, Duluth,
Minn./Superior, Wis., Green Bay, Wis., Minneapolis/St. Paul, Memphis, and
Jackson, Miss., with connections to all points in North America. For more
information on CN, visit the company's website at www.cn.ca
GO Transit is the Province of Ontario's interregional public transit
system linking Toronto with the surrounding regions of the Greater Toronto
Area (GTA). GO carries nearly 55 million passengers a year in an extensive
network of train and bus services that spans over 8,000 square kilometres.
For further information:
For further information: Contacts for CN: Media: Mark Hallman, (905)
669-3384; Investors: Robert Noorigian, (514) 399-0052; Contacts for GO
Transit: Media: Vanessa Thomas, (416) 869-3600, ext. 5264; Jessica Kosmack,
(416) 869-3600, ext. 5231