Grupo Mexico Inks $2.1B Deal for Ownership of Florida Railroad
Mexican miner and railway owner Grupo Mexico struck a deal to pay $2.1 billion for the 565-mile Florida East Coast Railway (FECR). The buyer has announced its intention to manage foreign assets, after dominating Mexico’s railway freight sector. Grupo Mexico owns 74% of Ferromex, Mexico’s largest railway, by mileage.
The announced transaction comes amid President Donald Trump’s threats to renegotiate the North American Free Trade Agreement (NAFTA). Over the years, NAFTA has allowed rail freight operators to shuttle a variety of products, from car parts to beer, across regional borders.
The contract between Grupo Mexico and Jacksonville, FL-headquartered FECR gives the former a toehold on Florida’s east coast. FECR, which was taken private by Fortress for $3.5 billion in 2007, also operates All Aboard Florida, a parent of Brightline, which is a high-speed passenger rail operation that will begin service in summer 2017.
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