U.S. Steel sells Transtar short lines to Fortress

United States Steel Corp. announced yesterday that it has agreed to sell Transtar LLC to an affiliate of Fortress Transportation and Infrastructure Investors LLC for $640 million.

The transaction is expected to close in the third quarter subject to customary closing conditions, including receipt of certain regulatory approvals, U.S. Steel officials said in a press release.

Transtar owns six short lines: the Gary Railway Co. in Indiana; the Lake Terminal Railroad Co., Ohio; Union Railroad Co. LLC, Pennsylvania; Fairfield Southern Co. Inc., Alabama; Delray Connecting Railroad Co., Michigan; and the Texas & Northern Railroad Co., Texas.

Among the transaction's benefits is an initial 15-year contract to maintain the short lines' existing operations, U.S. Steel officials said.

"By selling Transtar to an experienced railroad operator, [we] can better focus on our broader 'Best for All' strategy," said U.S. Steel President and Chief Executive Officer David Burritt. "In addition, the strong partnership we have created with [Fortress] will ensure continued support of our steelmaking facilities with predictable and cost-effective railroad operations."