B&A restructures to attract buyers

HERMON – The president of Bangor and Aroostook Railroad said Wednesday that the company is cutting operating costs and restructuring the company in such a fashion as to make it more appealing to potential buyers.

Fred Yocum, who took over as president of the company in February, said the company has leased part of its rail line near Madawaska and offered early retirement options to its employees to help the company reduce its cost. Fourteen employees accepted the early retirement offer, though Yocum said he didn’t know the exact number of employees who were offered the option.

“During this period, what we’re trying to do is substantially reduce our cost, improve our service and increase our assets,” Yocum said.

Yocum said B&A’s parent company, Iron Road Railways, placed him at the head of B&A after the previous president failed to secure a purchase of the rail line.

“I’m here,” Yocum said, “largely because we haven’t had a successful transaction at this point.”

The company also has reorganized some of the ways in which it ships product for its customers. A new agreement with Guilford Transportation, Yocum said, means that french fries produced by McCain in Aroostook County now are shipped to B&A’s Hermon station where Guilford takes them to the Boston market.

Yocum said there has been a lot of interest in the rail line by an assortment of would-be buyers.

“We’re working with a number of people,” Yocum said, “but there’s a number of confidentiality agreements” that he said prevented him from revealing any more information. Yocum said the list of potential buyers includes entrepreneurs, and both small and large rail lines.

B&A maintains 858 miles of line in Maine, Vermont and Quebec. The company has had its share of financial difficulties in recent years, including leases on locomotives, local property taxes and at least one case of unpaid utilities. And the Occupational Safety and Health Administration in January cited the company with 48 alleged workplace safety violations at its Milo facility and imposed more than $133,000 in fines.