• CMQ for sale?

  • Discussion of present-day CM&Q operations, as well as discussion of predecessors Montreal, Maine & Atlantic Railway (MMA) and Bangor & Aroostook Railroad (BAR).
Discussion of present-day CM&Q operations, as well as discussion of predecessors Montreal, Maine & Atlantic Railway (MMA) and Bangor & Aroostook Railroad (BAR).

Moderator: MEC407

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  by backroadrails
 
For the past few days I have heard talk of CMQ going up for sale in Q1 if car counts don’t increase. It hasn’t been officially announced by Fortress so I am unsure if it is true or not, but I guess we will find out soon if it is true.
  by kilroy
 
Fortress Investments is a hedge fund and not a railroad holding company so the sale of the company is expected at some point.

They need/expect double digit returns so if CMQ is not generating those returns and it is not forecast to do so in the near future, then I would expect Fortress to dump them. It's the nature of the beast.
  by CPF363
 
Who would be in line to buy the CM&Q should Fortress Investments decides to divest of it?
  by backroadrails
 
I didn't really hear if CMQ was in fact loosing money, but it could just be Fortress was looking for a quicker ROI on CMQ. It hasn't been necessarily confirmed but I did hear that G&W was interested.
  by MEC407
 
G&W would make sense if for no other reason than because they're already such a huge presence in New England.
  by backroadrails
 
Although unconfirmed I think CP was looking into it as well.
  by NHV 669
 
Isn't most of CMQ's network of lines mileage that CP didn't want anymore, as of less than 30 years ago?
  by CN9634
 
CMQ has been a profitable railroad the last 3 years with growth in revenue about 3-5% per year.
  by roberttosh
 
I’d be real surprised, more like shocked, if CP had any interest whatsoever in the CMQ. The only caveat being if the crude oil by rail business to Saint John takes off again.
  by Cowford
 
CMQ has been a profitable railroad the last 3 years with growth in revenue about 3-5% per year.
According to Fortress docs, revenue growth has actually been better than that (2018 is artificially high due to SLR reroute revenue). Mix (more chem and propane) is at least a partial explanation , as carloading growth has been pretty tepid. Net income varies (in the red 2015 and 2017, profitable 2016 and thus far in 2018 - again, the reroute revenue helped a lot).
  by ShortlinesUSA
 
If the railroad is indeed for sale, I would look for one of the second-tier holding companies to make a move on it. I don't see the line turning the kind of big numbers G&W or Watco need to pump up their portfolios to continue to fund additional acquisitions. International Rail Partners (the latest iteration of RailAmerica under Marino) is in the market, as well as OmniTrax and Patriot Rail. I do not think you will see any Class 1 move on this property.
  by backroadrails
 
I would expect other short line operators to try to buy CMQ if it does indeed go up for sale, and even with the loss of LMS traffic, traffic has been slowly increasing (I suspect just not as fast as Fortress would like). The only logical explanation I could come up with as to why CP would be interested in CMQ is trying to get back to New Brunswick, to try to steal business back from CN. But I guess for now we will only be able to wait, and see once something does happen.
  by backroadrails
 
Per a report on Facebook, Fortress Investments has given the green light for the sale of CMQ.
  by GP40MC1118
 
What Facebook group was that on?

D
  by backroadrails
 
Either the post was taken down, or I just can’t find it. But it was in the “Central Maine and Quebec Railfan and Train Chasers” group and was by Mike Andrews.
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