Fortress Investment to acquire Florida East Coast Industries
New York-based asset management firm Fortress Investment Group has reached an agreement to acquire Florida East Coast Industries, the parent company of the Florida East Coast Railway, for $3.5 billion in an all-cash transaction.
FECI announced the deal Tuesday morning, and said its board of directors has already given unanimous approval to Fortress Investment's offer of $84 a share, a 13.3 percent premium over FECI's Monday closing price of $74.13. FECI said it is also a 31 percent premium over the average closing price over the last 60 days.
FECI includes the railroad, which has 350 miles of track running between Jacksonville and Miami, plus the Flagler Development Group, a commercial real estate operation with an estimated 8.6 million square feet of Class A office and industrial space.
The railroad handles a mix of intermodal freight, cars and heavy equipment, and bulk commodities.
'Our focus has always been about maximizing shareholder value,' said Adolfo Henriques, chairman, president and chief executive officer of FECI, in announcing the deal. 'The value created by this transaction is a direct result of our employees’ dedication, commitment and hard work over many years. We look forward to working together with Fortress to continue to build our business.'
There was no immediate comment on how the transaction would affect FECI's operations or management, but FECI said it planned to proceed with its previously scheduled quarterly earnings conference call on Wednesday morning, when the transactions would be discussed in detail with analysts and the press.
In addition to its rail line, the FEC Railway operates drayage services, with intermodal yards in Atlanta, and the Florida cities of Jacksonville, Fort Pierce, Fort Lauderdale and Miami.