Patriot Rail Company LLC (Patriot), SteelRiver Transport Ventures LLC; Global Diversified Infrastructure Fund (North America) LP; First State Infrastructure Managers (International) Limited; and Mitsubishi UFJ Financial Group, Inc. (MUFG) (collectively, Patriot Rail), have filed a verified notice of exemption pursuant to 49 CFR 1180.2(d)(2) to acquire control of 15 Class III rail carriers (the Pioneer Short Lines) ^[1] controlled by Pioneer Lines, Inc. (Pioneer). Patriot Rail currently controls 16 Class III rail carriers (the Patriot Short Lines) in 14 states.^[2]

The transaction may be consummated on or after September 9, 2022, the effective date of the exemption (30 days after the verified notice was filed).

According to the verified notice, through a Stock Purchase Agreement, Patriot (an indirect holding of MUFG) will acquire a controlling interest in Pioneer, and, consequently, an indirect controlling interest in several Pioneer subsidiaries, including the Pioneer Short Lines.

The verified notice indicates that: (1) none of the Patriot Short Lines connect with any of the Pioneer Short Lines; (2) the transaction is not part of a series of anticipated transactions that would connect any of the Patriot Short Lines or Pioneer Short Lines; and (3) the transaction does not involve a Class I rail carrier. The proposed transaction is therefore exempt from the prior approval requirements of 49 U.S.C. 11323 pursuant to 49 CFR 1180.2(d)(2).

Under 49 U.S.C. 10502(g), the Board may not use its exemption authority to relieve a rail carrier of its statutory obligation to protect the interests of its employees. However, 49 U.S.C. 11326(c) does not provide for labor protection for transactions under 49 U.S.C. 11324 and 11325 that involve only Class III rail carriers. Because this transaction involves Class III rail carriers only, the Board, under the statute, may not impose labor protective conditions for this transaction.

If the verified notice contains false or misleading information, the exemption is void ab initio. Petitions to revoke the exemption under 49 U.S.C. 10502(d) may be filed at any time. The filing of a petition to revoke will not automatically stay the effectiveness of the exemption. Petitions for stay must be filed no later than September 2, 2022 (at least seven days before the exemption becomes effective).

All pleadings, referring to Docket No. FD 36635, must be filed with the Surface Transportation Board either via e-filing on the Board's website or in writing addressed to 395 E Street SW, Washington, DC 20423-0001. In addition, one copy of each pleading must be served on Patriot Rail's representative, Robert A. Wimbish, Fletcher & Sipple LLC, 29 N Wacker Drive, Suite 800, Chicago, IL 60606.

According to Patriot Rail, this action is categorically excluded from environmental review under 49 CFR 1105.6(c) and from historic reporting requirements under 49 CFR 1105.8(b).

Board decisions and notices are available at www.stb.gov.