S&P lifts RailAmerica watch

Standard & Poor's said it removed the ratings on RailAmerica Inc., including the BB- corporate credit rating, from CreditWatch, where it had placed them with developing implications on July 23. The outlook is stable.

The agency said the CreditWatch resolution follows its review of Genesee & Wyoming pro forma for its pending acquisition of RailAmerica. Pro forma for the transaction, the corporate credit rating on the combined entity is the same as the RailAmerica stand-alone rating.

The agency said debt levels are elevated following the merger, but S&P expects cost savings and free cash flow to be applied for debt reduction.

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