RailAmerica, Inc. has announced the signing of an agreement to acquire the assets of three short-line freight railroads currently owned by affiliates of Gulf and Ohio Railways, Inc., for a total purchase price of $12.7 million, according to RailResource. The purchase of the three Alabama railroads — the Three Notch Railroad (THNR), the Wiregrass Central Railroad (WGCR), and the Conecuh Valley Railroad (COEH) — is expected to close in the second quarter of 2011 and is subject to customary closing conditions, including regulatory approvals, the company said. RailAmerica intends to use cash on hand to finance the purchase.

The 35-mile Three Notch Railroad connects Georgiana and Andalusia, Ala. The 20-mile Wiregrass Central Railroad links Waterford and Enterprise, Ala., and the 15-mile Conecuh Valley Railroad connects Troy and Goshen, Ala. The lines serve customers shipping primarily agricultural and manufactured products. Collectively, they hauled approximately 6,000 carloads of freight during the last fiscal year.

For the next 12 months, RailAmerica anticipates the three railroads will generate approximately $3.7 million in revenue, $1.2 million in operating income, and $0.7 million in depreciation and amortization.

“We are pleased to add these high-quality assets to our existing Alabama rail franchise,” said RailAmerica President and CEO John Giles. “Collectively, the railroads have a solid customer base as well as a number of opportunities for further growth. Additionally, the railroads are clustered in close proximity to our existing Alabama operations, which we expect to create significant operating efficiencies. We look forward to partnering with new and existing customers on the line and with the local community to continue growing business on these lines.”