Potential Takeover of RailAmerica (RA) Nears; Shares Trade Higher
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Last May, RailAmerica (NYSE: RA) said it hired Deutsche Bank to evaluate strategic options for the Company, including a possible sale. Well, all aboard, because RailAmerica might be pulling into the M&A station real soon.
According to reports out Tuesday, the transportation company with a market cap of just $1.2 billion might have attracted attention from peer Genesee & Wyoming (NYSE: GWR), as well as Watco Co.'s.
Potential acquirers submitted bids several weeks ago and the sale process is well into its second round, according to sources.
Fortress Investment Group (NYSE: FIG) acquired RailAmerica in 2007 and took it public again in 2009. The firm still retains a 60 percent stake in the company.
What kind of price should be paid is in question. RailAmerica is currently going for 8.8 times forward EBITDA, versus 11 times for Genesee & Wyoming. RailAmerica shares also peaked at $24.25 to $24.50 following the Deutsche Bank announcement in May, putting them well into all-time high territory.
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According to reports out Tuesday, the transportation company with a market cap of just $1.2 billion might have attracted attention from peer Genesee & Wyoming (NYSE: GWR), as well as Watco Co.'s.
Potential acquirers submitted bids several weeks ago and the sale process is well into its second round, according to sources.
Fortress Investment Group (NYSE: FIG) acquired RailAmerica in 2007 and took it public again in 2009. The firm still retains a 60 percent stake in the company.
What kind of price should be paid is in question. RailAmerica is currently going for 8.8 times forward EBITDA, versus 11 times for Genesee & Wyoming. RailAmerica shares also peaked at $24.25 to $24.50 following the Deutsche Bank announcement in May, putting them well into all-time high territory.
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