Independent infrastructure manager Ancala has formed short line rail specialist Phoenix Rail and has acquired Lehigh Valley Rail Management, which owns and operates short line rail and intermodal terminal infrastructure across Pennsylvania.
LVRM is Phoenix Rail’s first acquisition. LVRM owns and operates a 61-mile freight rail network through its rail operations in Bethlehem and Johnstown.
According to Ancala, LVRM provides competitive access to three class 1 railroads in North America: Norfolk Southern, CSX and CPKC.
The railroads are situated between multiple major metropolitan areas including New York City, Philadelphia, Baltimore and Washington DC. Its intermodal terminal and freight services are critical for enabling the transportation of freight through Northeastern U.S.
In a press release, Ancala said intermodal freight in particular has experienced high growth. According to the Association of American Railroads, intermodal volumes in 2024 through November have increased 9.1% on the previous year.
Short line rail plays a critical role in the transportation of freight, connecting shippers to the US national railroad network, it added.
The U.S. short line railroad industry generates $3.6 billion in revenues annually and continues to grow, particularly as shippers turn to lower carbon and cost-effective methods for transporting goods.
Intermodal freight in particular has experienced high growth. According to the Association of American Railroads, intermodal volumes in 2024 through November have increased 9.1% on the previous year.
Alex Yeros, CEO of Phoenix Rail, commented on the acquisition.
“We are thrilled to partner with Ancala to establish this railroad franchise,” Yeros said. “We intend to leverage our industry experience to acquire, grow and enhance the platform across the United States. LVRM is an attractive initial investment with clear opportunities to build on customer and industry relationships, enhance services, and invest for growth.”
Ancala has invested over $500 million in transport companies including Europe’s largest aerial emergency services provider Avincis, Liverpool John Lennon Airport and Scandinavian rail freight operator Hector Rail.
Lee Mellor, a partner at Ancala called LVRM a good investment.
“LVRM’s assets in Bethlehem and Johnstown are critical nodes on the US rail network and serve the densely populated Northeastern US with around 17% of the US population living within a day’s drive. We look forward to working with Alex and the team to grow LVRM and pursue further opportunities through Phoenix.”
The company did not disclose financial details of the transaction.