Trinity subsidiary Trinity Industries Leasing Co. will act as servicer of the railcars sold to Element per the terms of the alliance, operating as TrinityRail Asset Management Co., or TRAMCO.
The sale consisted of a portfolio of existing leased railcars from Trinity's lease fleet with a value of approximately $396 million. The profit recognized from the sale in the first quarter of 2014 is expected to be between $1.00 and $1.10 per share. Trinity said it will not have any remaining ownership interest in the leased railcars sold to Element.
Combined with the first sale of leased railcars executed last month, Trinity has sold a portfolio of leased railcars with a value of approximately $501 million from its lease fleet under the alliance. As previously disclosed, Element is expected to purchase an additional $500 million of leased railcars this year primarily consisting of new TrinityRail manufactured railcars, the majority of which are in Trinity's current leasing order backlog.