Monday, May 07, 2018

New consortium expresses interest in purchasing Hudson Bay Rail line

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One of the many washouts along the Hudson Bay Railway during flooding in 2017. One of the many washouts along the Hudson Bay Railway during flooding in 2017. OmniTRAX

On May 3, a consortium of Manitoba First Nations, led by Chief Glenn Hudson, and in partnership with iChurchill Inc., a private Canadian company, said it entered into an agreement to purchase the Hudson Bay Railway (HBR), the Port of Churchill and associated assets.

 

HBR, which is owned by OmniTRAX, Inc., has had service suspended since May 2017 following damage that was the result of severe flooding.

Chief Glenn Hudson, leading member of the First Nations consortium, said, "I stand together with my Northern Colleagues to welcome in a new day in Manitoba. A day that shows Canada the strength of First Nations, that shows how true partnerships are formed and ensures that together, the First Nations will build a stronger North, a stronger Manitoba and a stronger Canada. This is a true opportunity for all levels of government to put reconciliation into action."

Merv Tweed, president of OmniTRAX Canada, said the iChurchill group is one of several offers being evaluated and no transaction has been completed.

OmniTRAX Inc. entered into a Memorandum of Understanding in December 2016 with Missinippi Rail and One North on a potential sale of the Hudson Bay Rail line for a reported CA$20 million (US$16.18 million). In November 2017, a Toronto-based holding company, Fairfax Financial Holdings, had expressed interest in a partnership with Missinippi Rail and One North to buy the northern Manitoba rail and port infrastructure.

Should the iChurchill group formally execute the transaction, it plans to post a Request for Proposals for repair work shortly to "ensure repairs are well underway in advance of the fall/winter season."

In October 2017, the government of Canada gave OmniTRAX 30 days to fix the line or face legal action. The government followed through with its ultimatum Nov. 13, when it filed a breach of contract lawsuit against the shortline holding company.