Bankrupt Maine railroad's locomotives sold in auction
Thirty-five locomotives — most of them owned by the rail company that went bankrupt after a runaway oil train exploded and killed 47 people in Lac-Megantic, Quebec, last year — were sold at an auction held in Milo on Tuesday.
The Associated Press reported that auctioneer Adam Jokisch declined to provide an auction total, but noted the 35 locomotives sold for anywhere from $10,000 to $15,000 to upwards of $200,000 apiece. All but seven locomotives were owned by the bankrupt Montreal, Maine & Atlantic Railways.
Proceeds from the auction will pay back part of $3.7 million owed to Bangor Savings Bank, which had liens on 24 of the locomotives, the AP reported.
John Giles, CEO of Central Maine and Quebec Railway, which has assumed the bankrupt railroad’s operations, told the AP his company plans to spend $10 million on rail improvements over the next two years as part of its effort to improve rail speeds and lure back customers. Traffic levels are already at 40% to 50% of where they were under Montreal, Maine & Atlantic two years ago, he said.
The locomotives, some of which weren’t operational, were forfeited by a subsidiary of New York-based Fortress Investment Group, which bid $14.25 million for the railroad, the AP reported. The value of the sale grew to $15.85 million when Fortress forfeited the locomotives, which at the time were said to be worth $1.6 million.
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