Nicholasville, Ky.-based R.J. Corman Railroad Group LLC is acquiring most of the assets of Brossard, Que.-based locomotive manufacturer Railpower Technologies Corp. Financial terms of the deal were not disclosed.
Railpower, which has been operating under court protection from its creditors since early February, said the deal includes all assets except cash and the land and property located in St-Jean-sur-Richelieu, Que., as well as two road switching locomotives. The deal is set to close on May 20, pending court approval.
The offer won't provide any value to shareholders, Railpower said, though it added that the deal is "in the best interests" of the company.
Railpower said R.J. Corman plans to hire approximately 75% of Railpower's current work force, or roughly 29 employees. Railpower recently shut down its active operations and cut its already diminished workforce by half, to 39 employees.
As part of the deal, R.J. Corman has agreed to sell to certain current Railpower managers certain assets in the agreement, including the RTG cranes technology, and grant a "non-exclusive, perpetual, fully-paid royalty free license" to use intellectual property rights.
An R.J. Corman spokesman said the company would continue to advance Railpower's Gen-Set technology.
R.J. Corman adds Railpower’s assets to its stable of nine short line railroads, 19 derailment and emergency services locations, and 10 locations providing track materials.