Railtex Inc – ‘8-K’ for 6/4/96

As of:  Friday, 7/5/96   ·   For:  6/4/96   ·   Accession #:  899243-96-833   ·   File #:  0-22552

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Current Report   —   Form 8-K
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Document/Exhibit                   Description                      Pages   Size 

 1: 8-K         Current Report                                         3     12K 

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SECURITIES AND EXCHANGE COMMISSION  
WASHINGTON, D.C. 20549  

FORM 8-K  

CURRENT REPORT PURSUANT TO SECTION 13 OR 15(D) OF 
THE SECURITIES EXCHANGE ACT OF 1934 

Date of Report (Date of earliest event reported) June 4, 1996                   

RAILTEX, INC. 
(Exact name of registrant as specified in its charter)  

TEXAS                              34-022552                    74-1948124      
--------------------------------------------------------------------------------
(State or other            (Commission File Number)         (I.R.S. Employer    
jurisdiction                                               Identification No.)
of incorporation)                                                               

        4040 BROADWAY, SUITE 200, SAN ANTONIO, TEXAS       78209
--------------------------------------------------------------------------------
              (Address of principal executive offices)      (Zip Code)

Registrant's telephone number, including area code (210)841-7600                
                                   -------------

N.A.  
--------------------------------------------------------------  
(Former name or former address, if changed since last report.)  

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ITEM 5. OTHER EVENTS                                                            

Acquisition of the Indiana and Ohio Railcorp                                    
-------------------------------------------                                     

  On June 4, 1996, the Registrant purchased 100% of the stock of the
Indiana & Ohio Railcorp ("I&O") for $9.0 million and the assumption of          
approximately $3.5 million of outstanding debt.  The I&O was founded in 1979 and
has headquarters in Cincinnati, Ohio.  Through its subsidiaries, the I&O        
operates 10 line segments totaling 230 miles of track in southwestern Ohio and  
southeastern Indiana.                                                           

        The I&O transported approximately 19,000 carloads and generated revenues
from railroad freight operations of approximately $7.1 million in 1995.  Before 
its purchase by the Registrant, the I&O operated a passenger service through a  
wholly owned subsidiary.  The passenger service operation has been retained by  
the seller.  The I&O has a broad customer base and serves customers in the      
aggregates, paper, farm and chemical industries.                                

  The purchase of the I&O stock was funded by borrowings against the
Registrant's U.S. senior bank revolving acquisition line of credit provided by a
bank syndicate with First Interstate Bank of Texas, N.A. as agent.              

Equity Investment in Privatized Brazilian Railroad Network                      
----------------------------------------------------------                      

        The Registrant is participating, through a wholly owned subsidiary, in a
Consortium which was awarded the Concession to operate the 4,400 mile Center    
Eastern Network of the Brazilian National Railroad.  The Brazilian government is
currently in the process of privatizing the Brazilian National Railroad.  The   
Consortium includes RailTex International Holdings, Inc. (a wholly owned        
subsidiary of RailTex, Inc.), together with an affiliate of Companhia Vale do   
Rio Doce (CVRD), a leading Brazilian mining and transportation conglomerate, an 
affiliate of GP Investments, a leading Brazilian investment firm, and other     
investors. The Consortium was awarded the Concession at the government's minimum
bid price, approximately US $318 million. The Brazilian government structured   
the transaction as a 30 year concession with a 20% down payment and lease       
payments due in quarterly installments after an initial two year grace period.  

      RailTex International Holdings will hold 12.5% of the voting stock and
13.4% of the non-voting stock of the railroad to be formed by the Consortium.   
RailTex International Holdings expects to invest approximately US $16.1 million 
in the Consortium to fund a down payment and provide initial working capital.   
The investment will be financed with borrowings under RailTex's existing        
acquisition credit lines.  RailTex expects to account for the transaction using 
the cost method of accounting.                                                  

     The Center Eastern Network, which posted revenues of approximately US
$200 million in 1995, covers an area in Brazil where important steel, cement,   
lime, grain, fertilizer and petrochemical producing centers are located.  The   
Network has strategic links with other major                                    

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railroads in Brazil as well as access to Brazil's larger ports.  RailTex        
believes there is significant opportunity for the railroad to grow its revenue  
base and gain market share from other modes of transportation through improved  
operations and an invigorated sales and marketing function.  In addition,       
RailTex believes there is significant opportunity for the railroad to improve   
its profitability through cost reductions and improved efficiency, service      
reliability and customer service.                                               

SIGNATURES                                                                      

        Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the        
undersigned hereunto duly authorized.                                           

RAILTEX, INC.   
(Registrant)    

July 3, 1996                    By:    /s/ALLEN L. SMITH                        
____________                           _______________________________________  
(Date)                        Name:  Allen L. Smith                         
                                     _______________________________________
                              Title: Controller and Chief Accounting Officer
                                     _______________________________________

Dates Referenced Herein

				Referenced-On Page
This ‘8-K’ Filing		Date		First		Last			Other Filings
Filed on:		7/5/96							None on these Dates
		7/3/96		3
For Period End:		6/4/96		1		2
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