Phillipsburg-based Kyle Railroad getting new owners
By MIKE CORN
RailAmerica, the owner of Phillipsburg-based Kyle Railroad, has been acquired by an even larger short-line railroad.
Genesee and Wyoming Inc. on Monday announced it had completed the acquisition of RailAmerica, putting it into a voting trust pending purchase approval by the federal Surface Transportation Board.
The Surface Transportation Board is expected to announce its decision late this year or early next year, according to a statement from Genesee and Wyoming.
Sens. Pat Roberts and Jerry Moran, R-Kan., already have sent in letters in support of the purchase.
GWI and RailAmerica in July announced they had reached a merger agreement, with GWI purchasing RailAmerica for $27.50 a share, or a total purchase price of $1.37 billion.
The purchase was completed with a five-year $1.875 billion loan and $425 million revolving credit agreement. That will cover outstanding debt and transaction fees.
The merger will combine the two largest short-line and regional rail operators in North America. Together, the two groups own 108 railroads.
The Kyle, based in Phillipsburg, runs from north-central Kansas into eastern Colorado -- along the old Rock Island Railroad line.
Kyle has 625 miles of track and connects with Burlington Northern-Santa Fe at Concordia and Courtland and the Union Pacific at Salina and Limon, Colo.
In 2010, Kyle moved more than 21,000 rail cars, hauling wheat, soybeans, milo, ethanol and asphalt.
With the merger, revenues for GWI will increase to nearly $1.4 billion, based on a total of 15,100 miles of track and 1.8 million carloads. The combined company will have 1,000 locomotives and 4,300 employees.