G'day mate, we're goin' down under...
Wisconsin Central Leads Consortium in Acquiring Railroad in Australia
November 17, 1997 03:24 PM
ROSEMONT, Ill. Nov. 17 /PRNewswire/ -- Wisconsin Central Transportation Corporation (WCTC) WCLX said today that a consortium including its Wisconsin Central International, Inc. subsidiary Tranz Rail Holdings Limited; Berkshire Partners; and Fay, Richwhite & Co., Ltd. acquired the stock of Tasrail (TAS) from the Australian government. The purchase price was approximately US$15.4 million.
TAS is part of the Commonwealth of Australia's Australian National rail network. TAS operates a vertically integrated network wholly within the State of Tasmania, and is the exclusive commercial freight rail operator for the island state. TAS generated approximately US$15.1 million in revenues for its fiscal year ended June 30, 1997. In addition to the purchase price, the consortium has also committed to spend approximately US$14.2 million for capital expenditures over the next four years. The privatization of Australian National is the first step in the Commonwealth's process to privatize its entire rail system by the end of 1998. In addition, the State of Victoria has announced its intention to privatize its rail network by the end of 1998 and the State of Western Australia has also announced its intention to begin the privatization process of its railway by the end of 1998.
WCTC said it invested approximately US$5.1 million, derived from internally generated funds and borrowings under existing credit facilities. The equity method of accounting will be used to account for the transaction.
WCTC Chairman, President and CEO Edward A. Burkhardt said, "We are very excited about the prospects for TAS. The physical condition of the railroad and the attitude and work ethic of its management and employees are impressive. We see this as a solid rail system with good growth potential."
Shares of Wisconsin Central Transportation Corporation are publicly traded on the Nasdaq National Market System under the symbol WCLX. The company's principal subsidiaries, Wisconsin Central Ltd., Fox Valley & Western Ltd., Algoma Central Railway Inc. and Sault Ste. Marie Bridge Company operate approximately 3,000 route miles of railway serving Wisconsin, Illinois, Minnesota, Michigan's Upper Peninsula, and Ontario, Canada. WCTC holds a 23 percent equity interest in Tranz Rail Holdings Limited, which operates 2,400 route miles of railway nationwide in New Zealand. WCTC also holds a 34 percent equity interest in English Welsh & Scottish Railway Holdings Limited which operates most of the freight railroad services in Great Britain. SOURCE Wisconsin Central Transportation Corporation |
