The plan failed, and in 1880 the Vermont section was reorganized and leased by the Boston & Lowell Railroad.

Portland, Maine, was the most northerly ice-free port on the east coast of North America, and attracted attention as an outlet.

Montreal's solution was the St. Lawrence and Atlantic Railroad, but this left Great Lakes interests out.

The Lamoille Valley Railroad was chartered in 1867 to run from West Danville on the planned M&SJ northwest to Swanton.

To connect between the two divisions, the company at first used trackage rights over the Boston, Concord and Montreal Railroad from Fabyan to Dalton, New Hampshire, but soon built its own alignment.