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June 1, 2006

Providence and Worcester talking with national rail operator

Providence and Worcester Railroad Co., a regional freight railroad serving Rhode Island, said today it is ``exploring possible business opportunities'' with RailAmerica Inc., a national rail operator based in Florida.

Representatives of both companies declined to elaborate on what ``possible business opportunities'' might mean, but RailAmerica has acquired more than 60 railroads since its formation in 1986.

RailAmerica owns 42 regional and short line railroads in the United States and Canada. In New England, the Boca Raton-based company owns Connecticut Southern Railroad of East Hartford and New England Central Railroad of St. Albans, Vt.

Providence and Worcester Railroad announced its discussions with RailAmerica in a midday statement that said the two companies had signed a confidentiality agreement with respect to exploring ``business opportunities.''

``The Company stressed there is no agreement between the parties relating to any such business opportunities,'' the Providence and Worcester Railroad statement said. General counsel Mary A. Tanona declined further comment on the statement.

Susan Wright Greenfield, a spokeswoman for RailAmerica, said, ``On a regular basis, we do talk to a number of parties on joint marketing and business development opportunities.''

Shares of Providence and Worcester Railroad shot up in trading on the American Stock Exchange after the announcement, closing up 6.1 percent at $18 a share. RailAmerica's stock rose 10 cents today, closing at $11.35 on the New York Stock Exchange.

Posted by   at 5:11 PM | Permalink

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