Ontario Northland Transportation Commission (ONTC) is an operational enterprise agency of the Government of Ontario (Province) that delivers a variety of services including rail freight and rail passenger to largely rural, remote and First Nation communities in northeast Ontario. ONTC owns and maintains a railway network extending approximately 700 miles north of North Bay, Ontario. As part of implementation of a service improvement strategy, ONTC initiated a process to divest its rail freight service and to divest or enter into alternative delivery options with respect to its rail passenger services. The Agency issued a Request for Proposals (RFP) inviting bids to privatize its rail businesses.

On behalf of the Province, RLBA prepared a valuation of ONTC rail businesses to be used to assist the Province in evaluating bids tendered in response to the RFP. Consistent with opportunities offered prospective bidders in the RFP, RLBA developed going-concern values (GCV) for five different business opportunities.

Annual revenues, operating expenses and capital investments were estimated over a five year period. The net present value of both the resulting net cash flow and the terminal value at the end of that five-year period were calculated and summed to determine GCV for each business put out to bid.