John D. Boyd | Jan 06, 2011 11:52AM EST
Private short line operator Patriot Rail completed its acquisition of six small rail lines from paper industry firm Weyerhaeuser, giving the new owner 13 short lines in all.
Boca Raton, Fla.-based Patriot Rail said the deal closed Dec. 30, giving it control of about 500 track miles in 12 states. The two companies announced the agreement last summer as a way for Weyerhaeuser to shed its short lines.
The rail properties in the deal operate 160 track miles in four states and handle about 60,000 bulk carloads a year for Weyerhaeuser and International Paper mills and some third-party customers. They mainly haul wood and paper products, chemicals, industrial waste, minerals and agricultural products, and each interchanges with multiple Class I railroads for long-distance traffic as well as other short lines.
The companies did not disclose financial terms. Besides the railroads that change hands, Patriot Rail is obtaining 28 locomotives, over 300 owned railcars and 2,500 leased ones, plus some road vehicles, real estate and office buildings, track maintenance equipment, locomotive shops, rail car repair shops, a wheel shop, and rail yards.
Gary O. Marino, the short line firm's chairman, president and CEO, said the transaction gives Patriot Rail "very attractive railroads" with strong cash flow, well- maintained infrastructure, plus "a highly stable customer base and appealing growth opportunities."
Two of the former Weyerhaeuser lines are in Washington and the others in three Southern states.
In Washington, the deal includes:
--Columbia & Cowlitz Railway, which operates 14 track miles in southwest Washington.
--Weyerhaeuser Woods Railroad, with 23 route miles in that region connecting to Columbia & Cowlitz.
The properties in the South are:
--DeQueen and Eastern Railroad Company, with two rail operating units -- DeQueen and Eastern, and Texas, Oklahoma & Eastern railroads -- that operate on a total of 91 route miles in southeast Oklahoma and southwest Arkansas.
--Golden Triangle Railroad, with 9.5 route miles in central Mississippi.
--Mississippi & Skuna Valley Railroad, 22 route miles in Mississippi.
-- Contact John D. Boyd at jboyd@joc.com.
