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Eastern Railroad Discussion > watco and hedge fund team up to buy shortlines


Date: 01/08/19 09:16
watco and hedge fund team up to buy shortlines
Author: n

csx is going to be selling several thousand miles of track this year, so watco is getting some deep pockets

https://www.progressiverailroading.com/short_lines_regionals/news/Watco-Oaktree-form-strategic-partnership--56437



Date: 01/08/19 12:09
Re: watco and hedge fund team up to buy shortlines
Author: SCL1517

Oh? Is there an announcement posted somewhere about forthcoming CSX line sales beyond what was posted well over a year ago by Trains magazine?



Date: 01/08/19 12:37
Re: watco and hedge fund team up to buy shortlines
Author: Lackawanna484

Oaktree and Howard Marks are very respected, long term investors.

Posted from Android



Date: 01/08/19 13:10
Re: watco and hedge fund team up to buy shortlines
Author: n

foot said last year, i'm thinking in the 3rd quarter shreholder conference call or one of those invester conferences, csx had agreed not to sell anymore lines till after peak season per customer requsts. so far the lines csx has sold have been identical to the trains article from last dall.



Date: 01/10/19 05:23
Re: watco and hedge fund team up to buy shortlines
Author: JPB

This excerpt from the article is provocative:

"...Added Watco President and Chief Financial Officer Rick Baden: "With the strategic and financial support of Oaktree, added to the strength of our existing strategic partners, we are prepared now more than ever to continue making Watco a world-class, full-service transportation provider." Baden listed Kinder Morgan, Norfolk Southern Railway and SkyKnight Capital as other Watco strategic partners..."

Anyone have any particulars on what exactly the NS partnership is with Watco? Will Watco be the go-to shortline conglomerate that NS will work with as it evolves to the PSR ops model (a al Ithaca Central)?




Edited 2 time(s). Last edit at 01/10/19 05:26 by JPB.



Date: 01/10/19 14:02
Re: watco and hedge fund team up to buy shortlines
Author: Lackawanna484

NS is undoubtedly going to be very careful here, but it has an enormous amount to gain.   It proved in the Conrail split that it can put boots on the ground and research every spur, every county, every industrial site, and come up with an accurate estimate of value to them.  As recently as today it trumpeted new industrial parks and customers in which it played a role in developing during 2018.  New shippers.  Lots of 'em.

A passive investment by NS in a WATCO investment fund would require NS to maintain a Chinese wall between NS and watco about the proposed deals.No contact, no discussion, no coordination or collusion, not even winks or emails.  Especially if the seller was a public company.  But absolutely nothing would be in the way of WATCO hiring key business development people from NS to advise them, assess routes, etc



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