Mexican mining and rail conglomerate Grupo Mexico said March 28 that it has reached an agreement to buy Florida East Coast Railway Holdings Corp. for $2.1 billion.

Grupo Mexico Transportes said it will acquire 100 percent of the company's shares and assume its debt, pending approval of the deal by regulatory authorities. The transaction will be financed by $350 million in Grupo Mexico funds and $1.75 billion in debt.

Florida East Coast Railways operates a 351-mile freight system along Florida's Atlantic coast from Jacksonville to Miami. The railroad was founded in 1885 by Henry Flagler, a Standard Oil tycoon who developed resorts and communities on the state's coast.

The Jacksonville-based company finished construction of an overseas railway to Key West in 1912, but the line was heavily damaged by a hurricane in 1935. Florida's government bought the rail line to Key West and converted it into a highway.

The company was purchased in the 1930s by heirs of the du Pont family. In 2007, it was purchased by Fortress Investment Group.—AP

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