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RAIL EMPLOYMENT

Rail News Home M&A

5/9/2012



Rail News: M&A

SteelRiver to acquire Patriot Rail; Metrolink's Fenton to succeed Marino as CEO


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Investment management firm SteelRiver Infrastructure Partners has reached an agreement with Patriot Rail Corp. to acquire all of the short-line holding company’s capital stock through infrastructure investment vehicle SteelRiver Infrastructure Fund North America LP.

The acquisition is subject to customary closing conditions, including the approval of a control notice of exemption filed with the Surface Transportation Board. Patriot Rail owns 13 short lines operating in 13 U.S. states.

“We believe that [Patriot Rail’s] scale and operating strategy will allow SteelRiver to capitalize on additional consolidation opportunities in the short-line rail industry in North America,” said Chris Kinney, senior managing partner and chief executive officer of SteelRiver Infrastructure Fund North America, in a prepared statement.

As part of the transaction, Patriot Rail Chairman, President and CEO Gary Marino — who founded the holding company in 2006 — will retire after the transaction closes and provide consulting services to Patriot Rail’s management and board. Marino had previously co-founded RailAmerica Inc. and served as the company’s chairman, president and CEO.

SteelRiver also announced it named John Fenton CEO, effective upon the transaction’s consummation. He most recently was CEO of Metrolink, which he served since April 2010. Fenton previously was an operating partner of investment bank CIH Capital Partners, president and CEO of OmniTRAX Inc., general manager and vice president of CN, and VP of the Kansas City Southern and Atchison, Topeka and Santa Fe railways.

“The acquisition of Patriot by SteelRiver will enhance the growth prospects of the company and ensure that customers and stakeholders continue to be served by a committed long-term owner,” said Fenton.  

Prior to stepping down as the top executive at Metrolink, which is governed by the Southern California Regional Rail Authority, Fenton led the commuter-rail agency through a period of revitalization and growth, including the development of an enhanced safety culture and initiation of positive train control implementation.

"John's impact on Metrolink and our customers will be felt for many years to come and we thank him for his vision, dedication to safety and leadership," said Metrolink Chairman Richard Katz in a prepared statement.

Metrolink's board has begun the process to find its next CEO. Over the next several weeks, Fenton will help the agency develop a transition plan.


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