Yahoo Finance Virgin Trains USA ditches plans for stock market listing
Plans to list Virgin Trains USA on the Nasdaq stock exchange have come to a screeching halt.
The company said earlier this month it planned to sell shares for up to $19 (£15) each, which would have put the valuation of the train company as high as $3.1bn (£2.4bn).
Now it’s decided to remain a private company.
“As we explored a public offering, a number of alternative financing sources became available that allow us to keep the company private and meet our growth strategies,” said Ben Porritt, senior vice president of corporate affairs for Virgin Trains USA.
The company recently rebranded itself – changing its name from Brightline – after striking a deal with British billionaire Richard Branson’s Virgin Group.
“How wonderful to add Virgin Trains USA to the Virgin family, and we look forward to working with all of the Brightline team,” Branson had written in a blog post back in November.
As part of the terms of the public listing, the Virgin Group was planning to buy up to 2% of the company.
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Virgin Trains USA described itself in official documents with the US Securities and Exchange Commission as the “first new major private passenger intercity railroad in the United States in over a century.”
The company operates express trains in Florida, and plans to expand to other parts of Florida and Las Vegas.
“We believe our business represents a scalable model for twenty-first century passenger travel in North America,” the company said.
However, the company was far from profitable. It reported revenue of $5.2m in the first nine months of 2018, but ultimately lost $87.1m over that period as it paid out tens of millions for salaries, maintenance expenses and administrative work. It also lost $44.7m in 2017 and $25m in 2016.
