SLRG Railroad auction nets $10.7 million bid

THE Chapter 11 federal bankruptcy court auction held Thursday for the San Luis & Rio Grande Railroad netted a high bid of $10.7 million from KCVN and its operator Colorado Pacific Railroad. Next comes a sale hearing that will be held Nov. 28 before U.S. Bankruptcy Judge Thomas McNamara.

If McNamara approves of the high bid and is satisfied with terms of how creditors will be paid, then KCVN and its corporate owner, Soloviev Group, will take the sale to the federal Surface Transportation Board for its sign off.

“This is a good outcome for everybody,” Railroad Trustee William Brandt said following the auction. With Soloviev Group as the corporate parent, the San Luis & Rio Grande Railroad will have ample resources to operate, Brandt said.

KCVN LLC, the formal bidder in the auction, is owned by Soloviev Group. It operates as Colorado Pacific Railroad in eastern Colorado around Eads in Kiowa County. Stefan Soloviev is the CEO of Soloviev Group. He took over the company from his father, Sheldon H. Solow, who was a heavyweight in the real estate world of New York before he turned over the company to his son in 2018 and then passed away in 2020.

Real estate taxes owed to counties

The Debtor has not paid the majority of its real estate taxes since 2012. The following claims of amounts owed through June 2022, which include interest, have been filed:

Rio Grande County: $877,157
Conejos County: $635,131
Costilla County: $390,454
Alamosa County: $739,000
Huerfano County: $1,180,122

source: Bankruptcy Court Filing

READ THE COURT FILINGS HERE

Soloviev Group was a late entrant in the bidding for the San Luis & Rio Grande Railroad. An initial high bid of $5.75 million came from OmniTrax before KCVN and Soloviev Group topped it with a bid that should satisfy the creditors that include Alamosa, Rio Grande, Costilla, Conejos and Huerfano counties.

“There’s enough there for responsible people to find a way to make a deal,” said Brandt of the $10.7 million bid.

Big Shoulders Capital, the largest creditor in the bankruptcy proceeding at $5.59 million, had filed an objection to the terms Brandt had previously negotiated with OmniTrax.

A hearing before McNamara then resulted in Thursday’s bid auction with KCVN and Soloviev Group now in the driver’s seat to own the historic railroad headquartered in Alamosa.

Brandt said an expedited timeline will be filed with the Surface Transportation Board to get its approval as quickly as possible to allow the new operator to take over railroad operations in the San Luis Valley.

Stefan Soloviev is an intriguing new billionaire player for the San Luis Valley, with a history of cattle ranching in New Mexico and moving agricultural products along the Colorado Pacific Railroad in eastern Colorado.