BETHLEHEM, Pa. — Seeing “significant opportunities to grow,” independent infrastructure manager Ancala and Arkadia Rail Partners have formed Phoenix Rail following the acquisition of short line rail company Lehigh Valley Rail Management.
Terms were not disclosed.
Lehigh Valley Rail Management owns and operates a 61-mile freight rail network and is headquartered in Bethlehem, Pa., where it operates an intermodal terminal. It maintains a transload facility in Johnstown, Pa., and connects to Class 1 carriers Norfolk Southern, CSX and CPKC.
Phoenix Rail management is led by Chief Executive Alex Yeros, who was a principal at the former boutique investment firm Brookhaven Capital Partners, now Arkadia. Ancala said the management team most recently acquired Pioneer Lines, a shortline holding company with 15 railroads across the United States, in 2019 and sold it to Patriot Rail in 2022.
The transaction is Ancala’s second infrastructure transaction in North America, following investment in Noventa Energy in 2023.
Ancala said in a press release that it will work alongside the management team “to build the Phoenix Rail platform into a best-in-class owner and operator of railroads and rail-related businesses. Phoenix Rail will unlock growth by investing in infrastructure, expanding existing and developing new customer relationships, and pursuing adjacent business opportunities.”
“LVRM is an attractive initial investment with clear opportunities to build on customer and industry relationships, enhance services, and invest for growth,” Yeros said.
“Short line rail in North America is a resilient and highly fragmented market with significant opportunities to grow,” said Ancala Partner Lee Mellor. “Partnering with Alex and his proven management team is an exciting opportunity to deploy additional capital and build a significant rail business in the U.S.”
Ancala said it has invested more than $500 million in transport companies including Europe’s largest aerial emergency services provider, Avincis, Liverpool John Lennon Airport and Scandinavian rail freight operator Hector Rail.
— This article originally appeared at FreightWaves.com
