By Anthony Harrup / Wall Street Journal
Mexican mining and railroad company Grupo Mexico has agreed to buy Florida East Coast Railway Holdings Corp. in a $2.1 billion deal, expanding its transport operations in the U.S. with the acquisition of the 351-mile railway.
Grupo Mexico, which operates Mexico’s Ferromex and Ferrosur railways through its transport unit GMXT, said that the acquisition will complement its operations in Texas and increase the reach and scale of its North American rail operations.
GMXT will use $350 million in cash and take on $1.75 billion in debt to finance the transaction, which requires government authorizations before closing.
FEC, based in Jacksonville, Fla., is owned by funds managed by affiliates of Fortress Investment Group, operates along the east coast of Florida, serving the ports of Miami, Everglades and Palm Beach and handling some 550,000 railcars a year.