The western end of the MMA in Quebec - Date unknown Anonymous Photographer.
16 July 2014
Bankrupt MMA Railway Sells
its Quebec Assets for $3 Million
Lake Megantic Quebec - The railway at the centre of the Lake Megantic railway disaster sold its Quebec holdings for barely a tenth of their value, QMI Agency has learned.
The bankrupt Montreal Maine & Atlantic Railway (MMA), which operated the disastrous train, sold its Quebec-based locomotives and land for $3 million in January, documents show.
The value of the Quebec assets was more than $30 million, according to various assessment rolls examined by QMI Agency.
U.S.-based Central Maine & Quebec Railway (CMQ) purchased MMA's holdings in Quebec, Maine, and New Brunswick for $15 million.
The firm told QMI Agency the low purchase price won't guarantee any profits.
"The goal is that, commercially, it's a profitable venture, but it will take time to see if clients show interest," railway spokesman Daniel Matte said.
"MMA is a company in bankruptcy, with facilities that were substandard, to say the least. So there is a book value, but the market value was not the same."
Freight train service resumed through Lake Megantic in the spring.
The CMQ says it will spend $10 million over the next 12 months to renovate the tracks between Farnham, Quebec, and the U.S. border.
It also plans to buy new locomotives to replace MMA's obsolete equipment.
The U.S. firm expects to begin transporting hazardous materials in January 2016, provided it can secure contracts to do so.