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A Rail World Inc.-led consortium is closing in on its purchase of Bangor & Aroostook Railroad System (B&A) from Iron Road Railways.
Although a Portland, Maine, U.S. Bankruptcy Court Dec. 4 entered an order for relief against B&A per an involuntary bankruptcy proceeding filed by the railroad's creditors — placing B&A under Chapter 11 bankruptcy provisions and delaying the sale — a Rail World official now expects to reach a purchase agreement by late June.
"We're moving ahead on two parallel tracks to get this transaction completed in the next couple of months," says Rail World President and Chief Executive Officer Edward Burkhardt. "We're working on our financing … and working with the trustee to make final the asset-purchase agreement, which will then be filed with the court. I'm quite optimistic on both fronts."
Rail World's rail investment and management consortium also includes Wheeling Corp., which owns and operates 680-mile Wheeling & Lake Erie Railway Co.
The purchase would include the operating assets of 420-mile Bangor & Aroostook Railroad Co., 294-mile Canadian American Railroad Co., Van Buren Bridge Co., Logistics Management Systems and 86-mile Northern Vermont Railroad Co. Inc. (except for a section south of Newport, Vt.), as well as stock in 186-mile Quebec Southern Railway Co. Ltd.
The consortium in October presented Iron Road Railways a letter of intent to purchase B&A, and planned to finalize an agreement by year end before bankruptcy proceedings intervened.
— Jeff Stagl