The operation was barely profitable and, in early 1864, the company asked the Government of Victoria buy the railway. The request was refused and the line was closed in July 1864. For the next three years, determined efforts were made to get the government to change its decision. In August 1867, the government paid £22,500 for the company's assets, and they became part of Victorian Railways. The racecourse branch was reopened in November 1867, and the section from Newmarket to Essendon was reopened in January 1871.[1]
Rolling stock
One steam locomotive built for the Melbourne and Essendon Railway Company in 1862 was sold unused to New Zealand's Canterbury Provincial Railways. Upon arrival in New Zealand, it became the country's first locomotive to operate in revenue service. Withdrawn in 1876, its frame subsequently returned to Australia when it was purchased by the South Australian Railways and was used as part of the SAR's locomotive No. 54, which operated until 1904.[2]
