A Mexican mining and railroad company will buy Florida East Coast Railway Holdings Corp. for $2.1 billion.
Grupo Mexico SAB, one of the biggest copper mining companies in the world, entered into an agreement to buy the Jacksonville-based 351-mile railway, a deal that will require government approvals, Reuters first reported. Grupo Mexico’s GMXT transport unit would finance the deal with $350 million in cash and $1.75 billion in debt, according to the Wall Street Journal.
Funds managed by Fortress Investment Group own Florida East Coast Railway. Fortress also owns Florida East Coast Industries as a separate entity, which is the parent company of Brightline, which is not included in this deal. Japanese telecom giant SoftBank Group Corp. previously announced that it would acquire Fortress for $3.3 billion.
Brightline, a passenger rail service planned for Miami to Orlando, will run on FEC tracks once it debuts this summer.
While the Orlando leg will be delayed until at least 2019 due to litigation, Miami to West Palm Beach is slated to start operating in the coming months. FECI affiliate All Aboard Florida estimates the total cost of both phases will exceed $2.9 billion. Phase 1 includes Miami, Fort Lauderdale and West Palm Beach, while phase two would extend to the city of Cocoa, near Cape Canaveral, and west from Cocoa to Orlando. [WSJ] – Katherine Kallergis