Thursday , January 21 2021

Virgin Trains USA, formerly Brightline, files to go public



On the same day, announced a major rebranding, since Virgin Group, of Richard Branson, became an investor, the formal rail company formerly known as Brightline, filed discreetly in the Securities and Exchange Commission, to become a capital company Open.

Virgin Trains USA, the name the company formally adopted on Friday, filed an S-1 form stating its intention to begin trading its shares on the open market.

A Brightline spokeswoman declined to comment, citing federal security laws. Under the so-called "silent period" rules, a company that files a registration with the SEC must wait for SEC approval before it can make additional public statements.

"We are the first major intercity private passenger railroad in the United States in more than a century, and we believe our business represents a scalable model for 21st century passenger travel in North America," the company said in the document. "Our goal is to build rail systems in North America that connect major metropolitan areas with significant traffic and congestion. We believe that the economy of rail passenger service offers a highly attractive investment opportunity. "

In the statement, Virgin Trains anticipates that passenger rail service in Florida, with stops in Miami, Fort Lauderdale, West Palm Beach and possibly Orlando and Tampa, "will stabilize in the fourth quarter of 2023 or in the first quarter of 2024, After a "ramp up period" of about two years.

During that time, the company said it expected passenger numbers to increase "as travelers familiarize themselves with the new rail service and adjust their travel habits."

The company uses the expected number of passengers to Orlando for its financial perspective, forecasting a total of 6.6 million passengers annually, paying $ 73 in fare.

"We expect to offer services between Miami and Orlando for fares that are less than the cost of driving or flying to individual travelers," the company said in the statement. "Based on our expected rates for an individual traveler, we expect a trip on our trains between Miami and Orlando to be approximately 25% cheaper than driving and about 30% less expensive than flying. We expect to carry approximately 6.6 million passengers annually. "

The company does not show its current passenger totals, instead it points to a 42% increase in the number of passengers in the second quarter of 2018 compared to the first quarter of 2018, and a passenger increase of 50% in the third quarter of 2018 compared to the second quarter of 2018.

In October, a public record related to the company's debt showed that Brightline's passenger count was 106,090 for the months of April, May, and June, and the total number of passengers at 180,870 accumulated for the year.

"The trends driving growth continue, and as a result, our management expects that the number of passengers in the fourth quarter of 2018 will continue to show strong levels of growth," the company said in the statement. "We believe that our new brand and relationship with the Virgin Group can help accelerate the growth of our passenger numbers in the future as we continue to move towards a stabilized number of passengers."

The company also discusses its plans to develop real estate adjacent to its stations, using Florida East Coast Industries, its parent company, as the lead developer.

The company affirms its desire to expand to other routes, including Atlanta to Charlotte, North Carolina, Dallas to Houston and Los Angeles to San Diego. In addition, the Tampa-Orlando route and the newly acquired Southern California-Las Vegas route are proposed.

The company belongs to the Fortress Investment Group, which also owns Florida East Coast Industries, a direct descendant of the Florida East Coast Railway Co., by Henry Flagler.

The S-1 filing provides an insight into the company's current financial status. In the first nine months of 2018, the company was operating at a loss of more than $ 87 million. In the same period, it raised more than $ 5 million in revenue. Its debt is more than $ 600 million and the total cash is around $ 49 million.

Since Brightline began testing in 2017, there have been at least seven people killed in accidents. There were also several non-fatal incidents, including a seriously injured woman in Pompano Beach. In most incidents, police reports did not cite Brightline as the failing party.

The company classifies itself as "an emerging growth company," which, under the securities laws, "can take advantage of certain small disclosures and other requirements that are generally applicable to public companies."


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