Client wants to buy a Class III railroad operation - insight needed!

Hey All,

Our firm has been approached by a railroad operator looking to acquire another Class III short-rail operation (incl. undeveloped real estate owned by the company). This is my first time digging into this space and I could use some insight as to how others have evaluated these niche opportunities. The target has not provided financials yet so it's hard to come up with an investment thesis. Here are a few point's that could be helpful (feel free to include whatever you have):

• What makes a target attractive / what do you look for
• short-rail rates (anything to help with a revenue build etc.)
• Operating metrics that you've come across / typical gross profit & EBITDA margins you've seen in the space
• Valuation / multiples
• Common levers an acquirer can pull to boost profitability & expand operations (aside from brining on new customers)
• Opportunities for the undeveloped real estate (i.e., what can a buyer do with the undeveloped RE)

Thanks for the help in advance! Also welcoming PM's if open to a more detailed discussion.