Acquisition of RailAmerica complete
October 8, 2012 / Updated October 26, 2012
Short Line Railroads
From news releases
Genesee & Wyoming Inc. announced earlier this month that it has completed the acquisition of RailAmerica, Inc. and entered into a new five-year Senior Secured Credit Facility comprised of a $1.875 billion term loan and $425 million revolving credit facility.
Among railroads that RailAmerica operates is the Dallas, Garland & Northeastern, KYLE Railroad, Texas Northeastern Railroad, Missouri & Northern Arkansas and Kiamichi Railroad.
Immediately following the closing of the acquisition, control of RailAmerica was placed into a voting trust with R. Lawrence McCaffrey appointed as trustee. The trust will remain in effect until the U.S. Surface Transportation Board (STB) issues its decision on GWI’s application to control RailAmerica and its railroads, which decision could be as early as the fourth quarter of 2012 or as late as the first quarter of 2013. During the period that RailAmerica is held in trust, GWI will account for its ownership under the equity method of accounting. Expected cost savings from the business combination will not be realized until the STB approves GWI’s control of RailAmerica’s railroads.
GWI financed the $1.37 billion cash purchase price for RailAmerica’s shares, the refinancing of $1.23 billion of GWI and RailAmerica’s total outstanding debt prior to the acquisition, as well as transaction and financing related expenses with approximately $1.85 billion of debt from its new five-year Senior Secured Credit Facility, approximately $460 million of cash from its recent public offerings of common stock and tangible equity units and $350 million through a private issuance of mandatorily convertible preferred stock to The Carlyle Group.
North American railroads have hauled coal in quantity ever since the anthracite roads were built on the East Coast. Decades later and despite many changes that have diminished production, coal remains a top (but declining) commodity. While it has weathered shifts in power generation and other factors leading to its decline, coal still accounts for 28 percent of total rail tonnage and 12 percent of revenue. Watch a coal trains roll by and you’ll notice that most cars are painted a stripe or block of color on one end. The color doesn’t matter, but the painted end has a rotary coupler, the non-painted end a solid drawbar. Learn how this combination of couplers enable railroads to move coal efficiently.
Manufacturers roll out the red carpet at January's Amherst Railway Society's Railroad Hobby Show in Springfield, MA. The show set an attendance record of 27,535 at what has become the big daddy of train shows. Several manufacturers came out in full dress to tout their latest products and announce new runs. At times it appeared to be a battle of the booths, something show chairman John Sacerdote anticipated leading up to the show. Lionel and Walthers did not disappoint.
After almost 20 years of top-line service, the Pennsylvania Railroad's St. Louisan and New Yorker were rechristened Spirit of St. Louis after the custom-built Ryan monoplane in which Charles Lindbergh made the first transatlantic flight. PRR’s advertising and publicity forces wasted no time capitalizing on transatlantic frenzy. The Spirit’s christening was celebrated June 15, 1927, less than a month after Lindbergh’s May 21 landing in Paris. Take a ride on the train in the Cowcatcher's ongoing series, "The Golden Age of Passenger Travel."
CN rolls out a medium horsepower hybrid locomotive that will be deployed this year across several of the railroads's yards and branch lines. Watching trains circle a layout adds a warm touch to modeling and relieves stress, say modelers. And more!
