Bangor & Aroostook RR Sold -- Again
WASHINGTON, D.C. -- Rail World said that its affiliate, Montreal, Maine & Atlantic Railway LLC, has signed an agreement to purchase the bankrupt Bangor & Aroostook Railroad (B&A), according to the Journal of Commerce.

The agreement includes 745 miles of rail line in Maine, Quebec and New Brunswick, Canada from B&A and its affiliates.

Employees on the B&A represented by the United Transportation Union are members of Local 856 in Houlton, Maine.

The asset purchase agreement was signed with James E. Howard, the court-appointed trustee of the B&A. The agreement will be submitted for approval by the bankruptcy court as soon as the affiliate parties have signed, Rail World said in a statement.

No purchase price was disclosed. Rail World previously agreed in October 2001 to buy the 119-year old B&A for $62 million, but when it missed a deadline to sign a formal agreement the railroad was placed in involuntarily Chapter 11 protection.

The B&A's Canadian affiliate, Quebec Southern Railway, is under court-supervised administrative proceedings. The other B&A affiliates involved in the sale are Canadian American Railroad, Northern Vermont Railroad, Newport & Richford Railroad and Van Buren Bridge Co., all of which have filed under Chapter 11 and are awaiting the appointment of a trustee. Also included is Logistics Management System, a warehousing and logistics subsidiary of B&A, which is operating as a debtor-in-possession.

Rail World, of Chicago, is led by president Edward A. Burkhardt, former chairman, president and chief executive of Wisconsin Central Transportation Corp. Burkhardt also currently serves as chairman of the supervisory board of Estonian Railways. Howard said that the deal would take several months to close, and that the bankruptcy court can still consider any "higher and better" proposals for purchase of the railroad's assets during that time.

In a statement, Howard said, "I am particularly pleased that the sale agreement contemplates an intact sale of the Bangor & Aroostook rail system in Maine and Quebec while maximizing return to the creditors. We are well aware that any alternative could involve a balkanization of the network, with potential line abandonments and loss of rail service to small communities." "We are very pleased to reach this milestone in the acquisition of the B&A," said Burkhardt. "We believe this can be a highly successful railway, and are anxious to close the purchase as soon as possible. We are particularly impressed with the quality of the employees and the customer base." He indicated that MM&A's plans had been "well received" in the financial markets, and that negotiations over placement of the financing were "well advanced."