Brightline, Virgin Group to form Virgin Trains USA

Brightline, the private intercity passenger-rail company in Florida, announced late last week it has reached a strategic partnership and trademark licensing agreement with billionaire Sir Richard Branson's Virgin Group.

The partnership calls for Brightline trains, stations and future developments to be marketed under the brand Virgin Trains USA, Brightline officials said in a press release.

In May, Brightline launched service between Miami, Fort Lauderdale and West Palm Beach. The company has plans to expand service to Orlando and Tampa. In addition, pending the closing of the previously announced XpressWest acquisition and receipt of federal approvals, Brightline could begin construction next year of a rail line between Las Vegas and Southern California.

As part of the strategic partnership, an affiliate of Virgin Group has agreed — subject to closing conditions — to make a minority investment in Brightline, although an amount was not revealed.

Funds managed by an affiliate of Fortress Investment Group LLC will retain majority ownership of Brightline.

Brightline's current management team will oversee daily operations, engineering, business development and strategy. The company will begin transitioning to the Virgin Trains USA brand in 2019.

"Our private sector-led effort to reinvent passenger-rail service in America is taking another leap forward with the addition of the Virgin team," said Wes Edens, chairman of Brightline and co-founder of Fortress Investment Group. "Virgin has built a respected and trusted brand in travel and hospitality. With our shared focus on customer experience, powered by a culture of innovation and disruption, we are well-positioned to build on our success."

Virgin Group has significant experience operating in the United Kingdom's rail sector, including the company's ongoing investment in Virgin Trains, a high-speed intercity passenger-rail system.

"Tens of millions of Americans travel on the railways every day, and we have tried for over a decade to find an opportunity to provide them with that same excellent service experience," said Branson, founder of Virgin. "Brightline is at the forefront of innovation in this market and the ideal partner for Virgin to work with to alter perceptions and traveling habits across the United States."