Brightline, the privately owned passenger railroad whose trains run through Brevard County between Miami and Orlando, is preparing to file for Chapter 11 bankruptcy as soon as this week, according to a Bloomberg report citing people familiar with the matter.
According to the report, the filing would leave out Brightline’s operating unit, which would keep the trains running and avoid having a federal trustee appointed to run the railroad. The restructuring would target about $1.1 billion in corporate debt, which ranks below the company’s senior municipal bonds.
The Fortress Investment Group-backed railroad carries about $5.5 billion in total obligations. Last month, Bloomberg reported that bond insurer Assured Guaranty agreed to provide at least $350 million in new loans if Brightline enters bankruptcy.
Brightline is also finalizing bankruptcy financing with a group of municipal bondholders led by First Eagle Investment Management and Nuveen, while hedge funds holding its corporate bonds remain in talks with the company. The timing of any filing could still change.
Locally, the City of Cocoa and the Space Coast Transportation Planning Organization were awarded roughly $57.5 million in federal funding for the Cocoa Multimodal Station and Rail Project, a planned Brightline station near SR 528 and Clearlake Road that Brightline would build with the city and then operate.
The Space Coast Rocket will continue to follow this story.
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