DARIEN, Conn. – Investment firms Brookfield Asset Management Inc. and Blackstone Group LP have shown interest in acquiring shortline railroad operator Genesee & Wyoming. The inquiries are made through affiliate companies Stonepeak Infrastructure Partners and EQT Partners, according to Bloomberg.
In March, Trains News Wire reported of G&W’s desire for an investment parter, or outright sale of the company.
Genesee & Wyoming operates 120 railroads in North America, Europe, and Australia. Its most recent high-profile acquisitions include Providence & Worcester in 2016 and Heart of Georgia Railroad in 2017. In 2012, G&W acquired rival shortline operator RailAmerica, which drastically increased its portfolio.
No more short lines to acquire and optimize at a reasonable price so G&W will probably sell itself since it can’t find growth anywhere.
Then these guys will break it up and sell the pieces to Patriot or RailUSA who are looking for more properties for their portfolio.
Essentially moving the chess pieces around the board again. Other than the Panhandle line CSX would rather close lines than sell lines out of fear someone might do it better, so they overprice them.
Warren Buffett DOES do mistakes now and then… Fascinating to see G&W grow, I first saw it when it was a salt-hauling short-line; I chased its salt train Retsof-Caledonia NY and back in late August 1980. I was a P&W shareholder yet I DID vote against the sale to Gee Whiz (G&W’s pet name with the locals in western NY) despite making much $$$ but Bob Eder’s “heirs” didn’t want to continue with the P&W so he sold out.
Blackstone + CNW = CNW being chopped up & then what was left sold to UP….
Warren Buffet loves trains, he has a full sized train set That is why BH is unique!
Not with Blackstone, they do both, investment for gain and investment for ownership…there isn’t another investment firm like Berkshire Hathaway on the planet unfortunately.
They had better be careful; these firms are both asset strippers, not a bit like Warren Buffett, who invests for the long pull.