USA: Wagon leasing company Trinity Industries completed a strategic restructuring of its wagon investment partnerships with alternative credit platform Napier Park on December 30.
Trinity previously held a 43% stake in TRIP Rail Holdings, which owned more than 17 000 wagons through its subsidiaries Tribute Rail and Triumph Rail. Trinity also owned 31% of RIV 2013 Rail Holdings, which owns more than 6 200 wagons via its TRP 2021 subsidiary.
Napier Park has now acquired 99·8% ownership of Triumph, while Trinity has acquired sole ownership of RIV 2013 and TRP 2021 and retains 0·2% of Triumph Holdings. Tribute remains a subsidiary of TRIP Rail Holdings under the joint venture structure, with Napier Park owning 57% and Trinity 43%.
Trinity expects to recognise a non-cash pre-tax gain of approximately $190m from the sale of its equity stake in Triumph Holdings.
Trinity said TRP 2021 and Triumph hold similarly diversified fleets with attractive, below-market interest rates on their debt with anticipated repayment dates in 2027.
‘This transaction demonstrates the strength of our investor partnerships and that railcars are ideal investable assets for private capital’, said Trinity CFO Eric Marchetto on January 6. ‘Napier Park began investing with Trinity in 2013 and is our longest-standing RIV partner. During this time, they have contributed $850m in equity and have grown their invested fleet to 33 000 railcars. We look forward to expanding our partnership with Napier Park and leveraging new opportunities for long-term growth.’
Trinity CEO & President Jean Savage said ‘this partnership proves the value creation that comes from railcar management and the strength of the Trinity platform’.
