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10/20/2005



Rail News: M&A

RailWorks sells products/services division to newly formed Tangent Rail



RailWorks Corp. has exited the wood tie and rail grinding markets. Yesterday, the company announced it completed the sale of its products and services division — comprising wood products, rail grinding, and crosstie pickup and disposal services subsidiaries — to Tangent Rail Corp. Terms weren’t disclosed.

PNC Equity Partners L.P., a private investment fund sponsored by The PNC Financial Services Group Inc. and a former RailWorks management team, formed Tangent Rail to acquire the division.

RailWorks will continue to own and operate its L.K. Comstock & Co. Inc. subsidiary, which provides electrical contracting services to transit-rail agencies, and track construction subsidiary that serves Class Is, regionals and short lines in the United States and Canada.

“This sale allows RailWorks to focus on its core business, and reinforces its commitment to the rail transportation and transit systems industries,” said RailWorks President and Chief Executive Officer Jeffrey Levy in a prepared statement.

Tangent Rail has formed three subsidiaries to operate portions of RailWorks’ former division:
• Tangent Rail Products (formerly RailWorks Wood Products) will provide treated wood, creosote and coal tar products;
• Tangent Rail Services (formerly RailWorks Rail Products & Services and RailWorks Rail Services of Canada) will provide rail grinding services for U.S. and Canadian Class Is, short lines and transit-rail agencies, as well as offer switching, locomotive and car maintenance services; and
• Tangent Rail Energy (formerly Wood Waste Energy) will provide crosstie pickup and disposal services, and industrial tie-derived boiler fuel.

“The Tangent Rail team has great depth and experience in the railroad industry, [and] we will draw on that expertise to be leaders and innovators in the markets we serve,” said Tangent Rail President and CEO William Donley, who previously served as president of RailWorks’ Track Products & Services Group.


Contact Progressive Railroading editorial staff.

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