In 1988, the Canadian Pacific Railway filed to abandon the Guelph & Goderich Railway, but local investors stepped in to purchase the line and keep trains running. This was only the first part of a shortline acquistion spree; when the Canadian National started purging southern ontario branches after the end of the At & East grain subsidies, the G&G picked up not only the CN line from Strafford to Goderich, but their lines from Exeter to Blythe and Guelph to Owen Sound.

These lines managed to produce a tidy (small, but tidy) profit, and in the late 1990s the line was in financial shape to propose a merger with the Hamilton-based Ontario Radial Railway Company and the group that had purchase the old Michigan Central’s Canada Southern line from Fort Erie to Windsor, forming the new Ontario Southwestern Railway.

The OSW still exists as a joint subsidiary of the LT&L and Delaware & Hudson, and is a vital part of the Parsons Vale’s western extension to Chicago, IL.