RailAmerica returns to its asset-rationalization, debt-reducing past (2/6/2003)


On Feb. 6, RailAmerica Inc. announced plans to sell more than $100 million in non-strategic, non-core, non-operating assets by year-end 2004 as part of a strategy to reduce debt, improve margins and free-cash flow, and enhance earnings.

The asset rationalization plan includes RailAmerica's proposed sale of its 55 percent interest in Chilean railroad Ferronor (announced last week), as well as several small railroads, non-operating real estate and other non-core assets in North America and Australia.

"Although we have made great strides in reducing financial leverage over the past few years, in these uncertain economic times we feel that it is prudent to operate with a conservative capital structure," said Gary Marino, RailAmerica chairman, president and chief executive officer, in a prepared statement. "We believe that the market for completing these transactions is robust."

Source: Progressive Railroading Daily News