(The following story by Jeffrey Pieters appeared on the Post-Bulletin website on June 13.)
ROCHESTER, Minn. — A sale announcement may be coming soon from the Dakota, Minnesota & Eastern Railroad, a rail industry magazine reports.
Trains magazine, in a report posted to its Web site on Tuesday, said that DM&E’s parent company, Cedar American Rail Holdings, is accepting bids from about 10 bidders. The bidders are finalizing their offers this week, the magazine reported.
Among the bidders are three railroad companies: Canadian National, Canadian Pacific and a shortline railroad company that was not named.
Cedar American Rail Holdings owns both the DM&E and Iowa, Chicago & Eastern railroads, which together make up a 2,000-mile-plus railroad system.
DM&E was denied on Feb. 26 in its application for a $2.3 billion federal loan.
Selling all or some of its assets is apparently how the company plans to finance a $6 billion upgrade and expansion project that would extend DM&E’s reach from near Winona to Wyoming coal fields. The project would create the most direct rail route from the Powder River Basin to the Upper Midwest.
The line passes through Rochester, whose leaders have objected to the project over fears that coal-train traffic would hurt the city.
DM&E President and CEO Kevin Schieffer could not immediately be reached.
According to Trains, however, Schieffer said last week in a letter to employees that “in the coming weeks, we will have potential investors and possible partners on the property.”
The railroad has federal approval for the expansion. A question is whether regulators’ green light is transferable to a new owner.
Rochester officials became aware of the magazine report this morning, said Mayo Clinic and Rochester Coalition spokesman Chris Gade.
“Regardless of who owns the DM&E, our goals and issues will remain the same,” Gade said. “We want to be sure the safety needs of our patients, staff and community are met and met in a substantial and meaningful way.”