CP to Acquire CM&Q From Fortress
Written by Andrew Corselli
Canadian Pacific (CP) has reached an agreement with Fortress Transportation and Infrastructure Investors LLC (FTII) to acquire the Central Maine & Quebec Railway (CM&Q).
CMQ owns 481 miles of rail lines, primarily in Quebec and Maine. The end-to-end transaction will provide CP customers with access to ports at Searsport, Me., and to Saint John, New Brunswick, via Eastern Maine Railway Company (EMRY) and New Brunswick Southern Railway (NBSR).
“This strategic acquisition gives CP a true coast-to-coast network across Canada and an increased presence in the eastern U.S.,” said CP President and CEO Keith Creel. “With additional port access, more dots on the map and our proven Precision Scheduled Railroading operating model, we are confident this transaction will bring benefits to all stakeholders moving forward.”
As part of the transaction, FTII will retain ownership of Katahdin Railcar Services (KRS), a tank car cleaning and repair facility, and the contract to operate at a 12-mile branch line at FTII’s Long Ridge Energy Terminal in Monroe County, Ohio. FTII noted it intends to continue to develop and grow both the KRS and Long Ridge branch line businesses.
The transaction is currently expected to close at the end of 2019 and remains subject to customary closing conditions. Over the coming weeks, CP, FTII and other stakeholders will move toward closing.
“We are excited about this transaction as it brings value to our shareholders, while ensuring that the CM&Q continues to provide safe and reliable rail transportation options,” said Joe Adams, FTII CEO.
CM&Q, Railway Age’s 2016 Regional Railroad of the Year, was created from the bankrupt assets of the Montreal, Maine & Atlantic, the railroad involved in the infamous Lac-Mégantic crude oil train disaster, a wreck that claimed 47 lives and decimated a small, bucolic Canadian village. “If history is to be accurately served, the history books will also recount how a new railroad came in, and did its best to set things right, restoring service, but more important, helping a community get back on its feet,” Railway Age wrote in 2016.
