Henry Posner III has filed a verified notice of exemption seeking authority to acquire a 27.75% stake in Morristown & Erie Railway, a Class III railroad operating in New Jersey.
Posner indirectly controls Iowa Interstate Railroad, a Class II carrier operating in Iowa and Illinois, through RDC Domestic Holdings, a noncarrier holding company.
According to the filing, Posner has entered into a stock purchase agreement and shareholders’ agreement as part of a new investor group that would acquire 50% of Morristown & Erie stock. The railroad’s current ownership group would retain the remaining 50%.
Posner certified that Morristown & Erie does not connect with Iowa Interstate, that the transaction is not part of a series of anticipated transactions that would connect the two railroads and that no Class I carrier is involved. As a result, the transaction qualifies for an exemption from prior Surface Transportation Board approval requirements.
The transaction may be completed as early as Sept. 19.
Because the deal involves control of a Class II railroad and one or more Class III carriers, it remains subject to statutory labor protection requirements. Posner also said that the transaction is categorically excluded from environmental review and historic preservation reporting requirements.
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