In the mid 1980s, the Delaware & Hudson was looking around to see if they could arrange a shorter route than their circuitous Conrail merger concession trackage rights from Scranton to Oak Island yard in Newark. A short but significant part of this route was the Rahway Valley Railroad, which connected between the old Erie Lackawanna main and the Lehigh Line, which was how the D&H’s concession trackage rights got into Oak Island.
The Rahway Valley was in the midst of hard times, so they were welcoming when the D&H approached them to ask about trackage rights, but before any agreement could be made their insurer cancelled their liability insurance and made it impossible for them to continue as a separate railroad.
With this in mind, the D&H offered to buy the railroad instead (the Parsons Vale had liability insurance up the wazoo, so the additional liability cover was not a problem) and so it was done.
In the years since, not much has changed on the Rahway Valley; the name of the railroad was changed to the Rahway Valley Railway, for one, and the trackage has been upgraded to allow 50mph trains and double-stack container cars (the interchange with the Lehigh line is a fairly tight curve, so that’s restricted to 20mph.)
The Rahway Valley has a couple of online shippers, so a single class DL10 switcher has been painted in bright red and assigned to the route.