Magnetic Rail Group Pty Ltd is a rail freight company that hauls bulk coal in New South Wales and Queensland. It was incorporated on 1 November 2022 as an Australian proprietary company, limited by shares. The company was formed as the corporate vehicle by which Magnetic Infrastructure Group Pty Ltd, an Australian incorporated 5050 joint venture ultimately owned by M Infrastructure Group Pty Ltd and PT Asian Bulk Logistics, would manage the former

One Rail Australia One Rail Australia was an Australian Rail freight transport, rail freight operator company. Founded by a United States short line railroad holding company, Genesee & Wyoming, Genesee & Wyoming Inc, in 1997 as Australian Southern Railroad, and s ...

coal haulage assets that it was in the process of acquiring. One Rail Australia had hauled about 30 per cent of Hunter Valley export coal volumes and since 2020 had expanded its operations into Queensland. In 2021, One Rail Australia agreed the terms of its purchase by rail freight operator

Aurizon Aurizon Holdings Limited ( ) is a freight rail transport company in Australia, formerly named QR National Limited and branded QR National. In 2015, it was the world's largest rail transporter of coal from mine to port. Formerly a Queensland G ...

. Since the latter company was already a major operator in the

Hunter Valley The Hunter Region, also commonly known as the Hunter Valley, Newcastle Region, or simply Hunter, spans the region in northern New South Wales, Australia, extending from approximately to north of Sydney. It contains the Hunter River and its ...

and Queensland coal haulage market, its acquisition of those assets had the potential to dilute competition. Consequently, Aurizon pledged a court-enforceable undertaking to

divest In finance and economics, divestment or divestiture is the reduction of some kind of asset for financial, ethical, or political objectives or sale of an existing business by a firm. A divestment is the opposite of an investment. Divestiture is a ...

the coal haulage assets of the business via trade sale or

demerger A demerger is a form of corporate restructuring in which the entity's business operations are segregated into one or more components. It is the converse of a Mergers and acquisitions, merger or acquisition. A demerger can take place through a cor ...

. After the sale was completed on 29 July 2022, a business unit operated by NHK Pty Ltd, a wholly owned subsidiary of Aurizon, was established behind an ethics wall to administer the divestment through an independent board of management and an independent manager approved by the ACCC. Magnetic Rail Group Pty Ltd was selected as the purchaser and the sale was completed on 17 February 2023. The sale price of the divested assets was

AUD The Australian dollar ( sign: $; code: AUD; also abbreviated A$ or sometimes AU$ to distinguish it from other dollar-denominated currencies; and also referred to as the dollar or Aussie dollar) is the official currency and legal tender of Au ...

2.35 billion (USD1.6 billion), of which AUD125 million (USD85 million) was to be deferred for 12 months. The sale price was described as representing a significant discount on the

1.16 billion (USD780 million) paid by Genesee & Wyoming Australia and

Macquarie Infrastructure Corporation Macquarie Infrastructure Corporation (MIC) owns, operates and invests in a diversified group of infrastructure businesses. Macquarie Infrastructure Corporation's business consists of the largest network of fixed-base operations in the United St ...

in 2016 for the former

Glencore Glencore plc is an Anglo-Swiss Multinational corporation, multinational commodity trading and mining company with headquarters in Baar, Switzerland, Baar, Switzerland. Glencore's oil and gas headquarters are in London, London, England as well a ...

rail business, which still forms the bulk of the acquired assets. Aurizon was to receive cash proceeds from Magnetic Rail Group of the equity value of approximately

425 million (USD290 million) after expected completion adjustments. Magnetic Rail Group would also assume the divested business's existing debt facilities, which originally totalled $500 million. In December 2022, when the purchase was under negotiation, the

International Railway Journal The ''International Railway Journal'' (''IRJ'') is a monthly international trade magazine published by Simmons-Boardman Publishing in Falmouth, England. History Founded by Robert Lewis and '' Railway Age'' editor Luther Miller as the world's ...

observed, "Magnetic Rail is not known to have any experience in rail so it remains to be seen whether it will become an operator in its own right, relying on existing ... management and staff, or whether it will contract out operations to an established freight operator."

Fleet

Magnetic Rail Group commenced operations with a fleet of 51 locomotives and 1468 items of

rolling stock The term rolling stock in the rail transport industry refers to railway vehicles, including both powered and unpowered vehicles: for example, locomotives, Railroad car#Freight cars, freight and Passenger railroad car, passenger cars (or coaches) ...

acquired from One Rail Australia. Details of the locomotives, , were as follows.

References

{{AustralianInterstateRail Companies based in Brisbane Freight railway companies of Australia Railway companies established in 2022 2022 establishments in Australia