In a deal which is set to reshape the Australian railway industry, QR will pay $446.5 million for “above rail” assets — 121 locomotives, 2,000 wagons, depots, customer contracts and 800 staff. B&B will acquire the “below rail” business for $853.5 million, comprising more than 5,000 kilometres of track on lease from the West Australian and South Australian governments.

Freehills and Corrs Chambers Westgarth advised B&B and QR respectively on the transaction, which involved both joint sellers and buyers, as well as the division into two of a single, fully integrated railway business. Cochrane Lishman acted for the sellers.

Corrs partner John Kelly said that in addition to these complexities, “we had to put in place new long term contractual arrangements between the separated QR and B&B businesses for the operation of these businesses going forward, and arrangements for the carve out from the sale of parts of the existing South Australian business which are to be retained by Genesee & Wyoming”.

Kelly led the Corrs team on the transaction with partner Michael MacGinley and senior associate Bruce Adkins. Corrs also undertook joint legal due diligence on behalf of both B&B and QR, which was led by partners David Hallam and Michael Harrison. Partner Adam Handley led the Corrs team that advised QR in relation to the ongoing track access arrangements between the joint acquirers.