Short line railroad operator Watco will take over rail infrastructure assets and related equipment at six major Dow Chemical North American sites, including two along the Texas Gulf coast and one in Louisiana.
Watco, the largest privately owned short line operator in the United States, will provide rail services at Dow’s flagship locations in Freeport and Seadrift, Texas; St. Charles and Plaquemine, Louisiana; and also at Fort Saskatchewan and Prentiss in Alberta, Canada.
Dow is the largest olefins and polyethylene manufacturer in North America. Watco operates 43 railroads in North America and Western Australia.
Watco owns Greens Port, located on 735 acres on the Houston Ship Channel in Harris County, Texas. It is the largest private multi-tenanted industrial park in the Gulf Coast market. In Texas, Watco operates Austin Western Railroad, Lubbock and Western Railway, Texas & New Mexico Railway, Pecos Valley Southern Railroad, San Antonio Central Railroad and Timber Rock Railroad.
“Watco is excited to serve Dow and honored to acquire these incredible assets,” said Dan Smith, Chief Executive Officer of Watco. “We are grateful for the confidence Dow has shown in Watco by trusting us with this critical role. This represents a revolutionary approach to industrial in-plant rail operations and we’re proud to help Dow create value for many years to come.”
Watco will partner with the Transportation Infrastructure group that manages the Infrastructure Investing strategy and funds managed by Oaktree Capital Management, L.P. to execute the transaction. Oaktree has been an investor in Watco since December 2018.
In a news release Josh Connor, Managing Director and Co-Portfolio Manager of Oaktree’s Infrastructure Investing strategy said “We appreciate Dow’s belief in Watco, and we look forward to this long-term partnership”. Oaktree is extremely proud to be a part of the Watco family. Working alongside high quality management teams, Oaktree’s Infrastructure Investing strategy is a constructive long term investor with financial and operational expertise, facilitated by deep transportation industry experience."