MMA chief says railway is worth more to creditors as 'going concern'
An engineer checks the engine of a Montreal Maine and Atlantic locomotive outside the offices of MMA railway in the town of Farnham, Que., on July 11, 2013. (Graham Hughes / THE CANADIAN PRESS)
Published Sunday, August 18, 2013 10:00PM EDT
The head of the railway at the centre of last month's Lac-Megantic train crash says he's pleased that Montreal, Maine & Atlantic's certificate of fitness has been restored by the federal regulator as it will help ensure the "best sale price" for creditors.
The Canadian Transportation Agency announced late Friday that it would be reversing a move made earlier in the week, and provide an extension to allow MMA to operate until Oct. 1.
The arm's length federal regulator had suspended the railway's certificate of fitness after ruling it didn't have sufficient insurance coverage. Friday's decision was based on new information provided to the CTA.
In an email to CTV News Montreal bureau chief Genevieve Beauchemin, MMA chairmain Edward Burkhardt said the railway, which was granted creditor protection in Canada and bankruptcy protection in the United States last week, will carry on with “vital freight services” until a long-term solution can be achieved.
The email reads:
"We are pleased with the CTA's action, which will avoid a very disruptive shutdown of vital freight services at on-line communities and further layoff of employees. This will give us time to work out a longer-term solution. Ultimately the railway will be sold for the benefit of the creditors, and it is worth considerably more as a "going concern" than if it were to be shut down. The major creditors are the province of Quebec and residents of Lac Megantic, and achieving best sale price will be beneficial to them. We will be working with the court appointed monitor and the US Trustee in developing the sale process."
An MMA train hauling crude oil derailed and exploded in Lac-Megantic on July 6. The incident killed 47 people and wiped out part of downtown Lac-Megantic.
A criminal investigation is underway, several lawsuits have been filed, and the provincial government has demanded money from MMA for the massive cleanup efforts.