MMA Railroad in Bankruptcy Court
The Montreal, Maine & Atlantic Railway (MMA) was in Federal Bankruptcy Court today in Bangor. The railway, headquartered in Hermon, filed for bankruptcy yesterday. It follows last month’s train disaster in Lac Megantic, Quebec that killed 47 people. MMA was granted for Chapter 11 bankruptcy protection, which will let it continue to operate as it normally would. MMA’s attorney tells us this is vital not just for the company, but for its employees and customers. MMA is currently facing multiple lawsuits from parties in the US and Canada. They expect more lawsuits to come from environmental groups and crash victims’ families. Since the train derailment in Canada, MMA’s monthly revenue has decreased from $3M to $1M, which lead to lots of people being laid off here in Maine. The company says bankruptcy will allow for a fair resolution for its creditors and all parties involved. The US Trustees office will name an Operating Trustee, someone who will make management decisions for MMA, including a possible sale of the company. “These railroads are incredibly important to the economy of the state of Maine. They employ about 85 people between the Maine company and the Canadian company, and as I said in court today they operate as one system. They serve dozens of customers, hauling critical supplies into manufacturing facilities into Maine and hauling finished product out of Maine… just critically important to the communities that they run through,”MMA is confident there won’t be more layoffs and that once they get the okay from Canadian officials, they will reopen the line through Lac Megantic, and rehire some employees. The company’s attorney also tells us they expect a lot of interest from other rail companies in buying the MMA lines. They railway is scheduled to be back in court later this month for a final hearing at which time they’ll present a budget plan.