OmniTRAX is slated to boost its rail network to more than 2,000 miles across North America with the acquisition of San Luis and Rio Grande Railroad (SLRG), a 155-mile Colorado short line.
The company on Oct. 12 reported entering into a contract to purchase out of bankruptcy the assets of SLRG. The acquisition would mark OmniTRAX’s 26th rail operation. The transaction is expected to close in late 2022.
William A. Brandt Jr., SLRG’s Chapter 11 trustee, told the Valley Courier last month that a “deal has been reached in principle, but the deal is still being negotiated.” According to the newspaper, OmniTRAX’s offer was $5.75 million, but about $4 million would need to be spent paying back taxes. In June, Brandt reported his intention to sell substantially all SLRG assets via auction.
Serving the San Luis Valley in southern Colorado, SLRG was originally constructed in 1870. It traverses the La Veta Pass over the Sangre de Cristo Mountain range, connects the eastern plains of Colorado to the San Luis Valley, and interchanges with Union Pacific at Walsenburg, Colo.
SLRG hauls industrial, mineral and agricultural commodities, and maintains railcar storage facilities along its right-of-way with a storage capacity of more than 3,100 cars. Prior to the bankruptcy filing, it also operated passenger excursion trains over the La Veta Pass at an elevation of 9,400 feet.
“As a Colorado company, we know how important the SLRG has been to the San Luis Valley and Colorado’s economy,” said Dean Piacente, CEO of OmniTRAX, a supply chain, industrial development and logistics provider, and the transportation affiliate of The Broe Group. “The Broe Group companies have grown with Colorado for 50 years and we are proud to help revitalize this railroad to bring more business and jobs to the region and our state.” He noted that SLRG “removes tens of thousands of trucks from Colorado’s highways and the Sangre de Cristo Mountain range’s scenic La Veta pass.”