RailAmerica plans to redeem $74 million in 9¼% notes with IPO proceeds

By Devika Patel

Knoxville, Tenn., Oct. 13 - RailAmerica, Inc. plans to redeem up to $74 million of its $740 million in 9¼% senior secured notes due 2017 using the proceeds of its planned $144 million initial public offering, according to a prospectus filed Tuesday with the Securities and Exchange Commission.

The notes will be redeemed at 103% of par plus interest to, but not including, the redemption date.

The notes priced at 95.923 on June 17.

Proceeds from the IPO will also be used for working capital and other general corporate purposes.

The issuer is a Jacksonville, Fla.-based short-line and regional rail service provider.

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