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Global Railway to acquire Canada Allied Diesel and affiliates by year's end

It's taking longer than expected, but Global Railway Industries Ltd. still expects to acquire Canada Allied Diesel Co. Ltd. (CAD) and its affiliates in the fourth quarter.

Today, Global Railway announced it signed a binding asset purchase agreement to acquire substantially all of CAD's net working capital, land, buildings, plant equipment and machinery, including assets of affiliates CAD Railway Services Inc., Engine System Development Centre Inc. and Lachine Rail Center Inc., for $22 million. The deal includes the acquisition of $12.5 million in net working capital.

The agreement supercedes a non-binding letter of intent Global Railway signed in July to acquire CAD and its affiliates, which sell new and refurbished locomotive engines and parts, refurbish rail cars and locomotives, and provide locomotive emission testing and engine diagnostic services.

"We originally planned to close this acquisition in early September [but] delays attributable to administrative processes behind the transaction could not be avoided," said Global Railway Chairman, President and Chief Executive Officer Terry McManaman in a prepared statement. "We are currently finalizing the financing arrangements and expect to close this transaction prior to the end of the year."

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More News from 10/11/2007