Eastern Railroad Discussion > Ferromex trying to buy FEC

http://trn.trains.com/news/news-wire/2017/03/27-ferromex-negotiating-deal-to-acquire-florida-east-coast-railway

Well, wasn't expecting that one....

cdrapollo20 Wrote:
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> Well, wasn't expecting that one....

No one expects the Mexican acquisition...

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exhaustED Wrote:
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> cdrapollo20 Wrote:
> --------------------------------------------------
> -----
> > Well, wasn't expecting that one....
>
> No one expects the Mexican acquisition...

Brilliant! :-)

GTD

Why does a Mexico railroad want the FEC???

Isn't ferromex owned partly by Union Pacific?

Posted from Android

jointauthority Wrote:
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> Isn't ferromex owned partly by Union Pacific?
>
> Posted from Android
Partnered with KCS I believe

Ed Stewart
Jacksonville, FL

Some info from the NASDAQ website...seems that KCS has some involvement....The potential deal shows that Ferromex's parent, Mexican
mining conglomerate Grupo Mexico <GMEXICOB.MX>, is now seeking
to apply its railroad operating expertise to foreign assets
after dominating the railway freight sector.
The acquisition would come at a sensitive time for relations
between the United States and Mexico, following a pledge by U.S.
President Donald Trump to renegotiate the North American Free
Trade Agreement and tighten immigration controls.
Grupo Mexico has prevailed in an auction for Florida East
Coast Railway and is now negotiating final terms with the U.S.
regional railroad's owner, Fortress Investment Group LLC
<FIG.N>, two people said.
If the negotiations are completed successfully, a deal could
be announced as early as this week, the people added, asking not
to be identified because the sale process is confidential.
Fortress declined to comment. Ferromex, Grupo Mexico and
Florida East Coast Railway did not immediately respond to
requests for comment.
Based in Jacksonville, Florida East Coast Railway operates a
351-mile (565-km) freight rail system located along the east
coast of Florida.
Fortress took Florida East Coast Railway private in 2007 for
$3.5 billion. Fortress, an investment firm with $69.6 billion in
assets under management as of the end of December, agreed last
month to sell itself to Japan'sSoftBank Group Corp <9984.T> for
$3.3 billion.
Grupo Mexico, one of the world's largest copper producers,
together with Kansas City Southern de Mexico and Ferrovalle,
control more than 72 percent of the Mexican rail freight market.
Grupo Mexico and Kansas City Southern de Mexico together have a
75 percent stake in Ferrovale.

Ferromex is about 26% owned by UP, nothing to do with KCS.  KCS de Mexico is the other major Mexican railroad.

gmojim

exhaustED Wrote:
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> No one expects the Mexican acquisition...

Still think that this is their funniest sketch ever, but I digress ........ this is, after all, a train site.

I wonder if they will need 'badges'
reel_smooth Wrote:
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> exhaustED Wrote:
> --------------------------------------------------
> -----
> > No one expects the Mexican acquisition...
>
> Still think that this is their funniest sketch
> ever, but I digress ........ this is, after all, a
> train site.

cn6218 Wrote:
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> exhaustED Wrote:
> --------------------------------------------------
> -----
> > cdrapollo20 Wrote:
> >
> --------------------------------------------------
>
> > -----
> > > Well, wasn't expecting that one....
> >
> > No one expects the Mexican acquisition...
>
> Brilliant! :-)
>
> GTD

PERFECT

Posted from Android

Just stick around, there will be more news than I can spit out at this time.

Posted from Android



Edited 1 time(s). Last edit at 03/27/17 18:10 by NS7214.

What's next? CSX selling their New Orleans- Jacksonville main to Ferromex/UP to tie it all together?

The way the Mexican peso has been appreciating against the dollar, FEC may not even cost FerroMex that much money.

There would be a delicious irony if Mexican employers decided to open manufacturing plants in the US. Like the Japanese and Germans have done.

The Reuters article that Trains cites states that Grupo Mexico is the one bidding for FEC, not Ferromex. Grupo Mexico as noted above is the majority owner of Ferromex, but UP has a significant stake. That's an important distinction to make, that Grupo Mexico is making this play -- UP would not be involved.

The relationship between FXE and KCSM is joint ownership of a third Medican railroad; KCS has no stake in FXE.

Grupo Mexico also owns Ferrosur, the major southern Mexican road, outright. They have the same paint scheme as Ferromex.

Interesting. We shall all stay tuned.

SantaFeRuss

Posted from Android

exhaustED Wrote:
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> cdrapollo20 Wrote:
> --------------------------------------------------
> -----
> > Well, wasn't expecting that one....
>
> No one expects the Mexican acquisition...

Excellent hilarious commentary! And the Python that utters those famous words is noted trainspotter Michael Palin!

Question: can we add Grupo Mexico as the third non-US based entity to own major critical US RR trackage, after CN and CP?

FWIW, Grupo Mexico already has American industrial interests -- notably to me, the Copper Basin Railway and the copper mine and smelter it serves east of Phoenix.