Grupo Mexico completes Florida East Coast acquisition

GRUPO México has completed the acquisition of Florida East Coast Holdings (FEC), the owner of Florida East Coast Railway, through its transport business unit, Grupo México Transportes (GMXT).

The $US 2bn acquisition positions GMXT as a relevant player in the North American transport market, together with its current operations in Mexico and the state of Texas. The acquisition was funded with a $US 1.55bn loan from BBVA and Credit Suisse, as well as a $US 250m loan from Santander, with the remainder funded with GMXT's own resources and $US 97m in debt at the FEC level.

Before closing the operation, GMXT obtained the approvals required from all of the regulatory agencies in the United States, including the Committee on Foreign Investment in the United States, the Surface Transportation Board and the Federal Communications Commission.

Grupo México confirmed its intent to acquire the 565km FEC in March. FEC operates a main line linking Miami and Palm Beach with St. Augustine and Jacksonville, where it interchanges with Class 1 railways CSX and Norfolk Southern. FEC handles around 550,000 loads of freight per year with commodities including chemicals, metals, wood and automobiles.