
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: FRIDAY, May 18, 1990                   TAG: 9005180855
SECTION: VIRGINIA                    PAGE: B-3   EDITION: EVENING 
SOURCE: 
DATELINE:                                 LENGTH: Medium

NS SELLS SOME OHIO TRACK/ NEW RAILROAD BEING FORMED FROM FORMER SMALL LINES

Norfolk Southern Corp. has sold 446 miles of track and facilities in Akron, Canton and Brewster in Ohio for $40 million to Wheeling Acquisition Corp., a company that is starting a new railroad.

NS also said Thursday it would sublease to Wheeling another 121 miles of track, formerly owned by the Pittsburgh and West Virginia Railway and now leased by Norfolk Southern's Norfolk and Western subsidiary.

NS said roughly 425 employees are affected by the sale. The new railroad expects to have a workforce of about 380 people, including management and supervisory staff, in its first year of operation.

A coalition of rail unions has been meeting with railroad officials trying to reach an agreement on the sale that would protect union employees. Meetings between the unions and management are being held today in Washington and possibly tomorrow.

Late Thursday night, a federal judge in Washington, D.C., issued a restraining order forbidding the unions to strike the railroad over the sale. Another court hearing will be held on Wednesday.

Arnold B. McKinnon, NS' chairman and chief executive officer, said the sale was consistent with Norfolk Southern's program of spinning off rail properties that can be more economically operated by smaller lines.

The new railroad will have access to NS yards in Cleveland and Bellevue, Ohio, and in Hagerstown, Md., and interconnections with CSX, Conrail and other carriers.

James W. Hanscome and James C. Rooney, formerly with the Federal Railroad Administration and William R. Ferguson, an experienced regional railroad operator, are the principals in Wheeling Acquisition. Operation under the new ownership will begin immediately.

As part of the sale, NS will provide financing up to $16.7 million for existing rolling stock, including locomotives and freight cars and has agreed to continue present traffic flows between points where the new railroad and NS connect.

The trackage in the sale represents essentially the former Akron, Canton and Youngstown Railroad, the former Pittsburgh and West Virginia Railway, and most of the former Wheeling and Lake Erie Railroad. All became Norfolk and Western Railway subsidiaries in 1964 when the Wabash and Nickel Plate railroads were also added to the NW system.

by CNB