CAW Welcomes news of
Savage Companies acquiring Alberta RailNet
April 26, 2005     
Savage Companies of Salt Lake City, Utah announced on April 21, 2005, that through its wholly
owned subsidiary, Savage CANAC Corporation, it has entered into a definitive agreement with North
American RailNet, Inc. of Bedford, Texas to acquire Alberta RailNet, Inc. “ARN”), a short line railway
operation based in Grande Prairie, Alberta.  The closing of the purchase is expected to be effective
May 1, 2005.  CAW National Council 4000 represents 24 Conductors and Locomotive Engineers at
ARN.  

CN had right of refusal of the sale, meaning they could have taken over operation of these rail lines,
which they sold back in June of 1999.  "CN's decision not to is good news to our members and
employees at ARN," states CAW National Council 4000 Regional Representative Barry Kennedy.

“From what we recently witnessed with CN’s acquisition of BC Rail, I’m not certain many of the some
60-employees who work for Alberta RailNet would still have a job had CN exercised this right.”  Mr.
Kennedy said that he believes that had CN stepped in and taken control of this operation, they would
have used existing staff at CN to operate, meaning job losses for ARN employees in Grande Cache
and Grande Prairie.  “They have surplus running trade employees in Jasper, surplus track and
engineering personnel in Western Canada, and the administrative and technical work would have
been consolidated in Edmonton and Winnipeg.”

“Based on the geographical position of Alberta RailNet with the former BC Rail territory and CN’s
mainline, I could see where it would have been logical for CN to once more operate these lines,
which they sold back in 1999.  Given the recent remarks reiterated by CN’s president and CEO
Hunter Harrison following CN’s April shareholders meeting, that providing the price is right, CN is
interested in purchasing small railways in Canada and the United States; it was very possible CN
could have snapped it up.  The Savage deal is good news for the communities of Grande Cache and
Grande Prairie, and I’m happy for the ARN employees, particularly our members, that Savage was
successful in the purchase,” expressed Kennedy.

“I hope Savage will carry through with the future plans that ARN discussed with the CAW over the
past year that will expand the business and the company’s operations in north-western Alberta.”  
Kennedy said that he has heard rumours that in a deal that’s long been discussed between ARN
and CN, ARN/Savage will take over operation of the rail line between Hythe, Alberta and Dawson
Creek, B.C., a section of abandoned track that CN’s been upgrading since their purchase of BC Rail
last year.  “This too would be welcome news for our members who would operate the trains on this
section of track.”

Kennedy says that the CAW looks forward to a good working relationship with Savage.  “We look
forward to what Savage, along with its subsidiary CANAC, has to offer with respect to not only
improving the overall operations of Alberta RailNet and its customer service, but for the working
environment of our union membership.”

This relationship will be put to the test as the CAW will commence contract negotiations with Alberta
RailNet later this year on its second collective agreement for the Company’s conductors and
locomotive engineers.  The CAW successfully certified this group of workers in 2002, negotiating and
ratifying its first collective agreement by May 2003.

CAW National Council 4000 is the umbrella organization for five (5) regionally based CAW Local
Unions across Canada that represents over 5,600 members in various sectors, largely within the
transportation industry.  Its Mountain Region membership falls under CAW Local 4001, with
members employed at Alberta RailNet, CN, Rocky Mountaineer Vacations, and VIA Rail Canada,
spanning Western Saskatchewan, Alberta and British Columbia.

ARN’s operations are comprised of 345 miles of track in energy-rich north-western Alberta, shipping
coal, lumber, grain, fertilizer, aggregates and many other products.  ARN’s service territory is located
exclusively within Alberta, stretching from the interchange with CN at Swan Landing (between Hinton
and Jasper), through Grande Cache to Grande Prairie, northwest to Hythe, and northeast to Rycroft,
Spirit River and Wanham, Alberta.  ARN currently moves approximately 25,000 carloads per year, but
Savage has stated that they expect growth, particularly in coal traffic, which will see movement of
more than 40,000 carloads by 2006.  Alberta RailNet’s headquarters is based in Grande Prairie.

More on this story:

Savage Companies acquire Alberta RailNet from North American RailNet
National Council 4000
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