The Greenbrier Companies, Inc., has acquired more than 3,600 railcars, a portion of which will be held by subsidiary GBX Leasing (GBXL), the company reported on Oct. 13.
GBXL is a recently formed special-purpose subsidiary, which is about 95% owned by Greenbrier. It was formed to “acquire a minimum of $200 million of newly built and leased railcars in its first year of operations,” and serve high-credit quality railcar lessees, which require leases with mid-to-longer term maturities, according to Greenbrier. GBXL’s fleet comprises nearly 4,000 units as of Sept. 30, 2021 and has a fair market value of $350 million—exceeding Greenbrier’s initial investment target for the venture by 75%, the company reported.
“The fleet was assembled through a combination of lease originations on Greenbrier built railcars and the portfolio acquisition announced today,” Greenbrier said. “This two-pronged acquisition strategy allows GBXL to rapidly scale a diversified portfolio of leased railcars.” The GBXL fleet hauls a variety of commodities and serves a range of industries, including agriculture, energy, petrochemical and consumer goods.
“By providing tax-advantaged cash flows, lease fleet investments reduce Greenbrier’s exposure to the inherent cyclicality of freight transportation equipment manufacturing,” Greenbrier CEO and Chairman William A. Furman said. “The recent railcar acquisition advances Greenbrier’s strategy to increase the scale of our lease fleet assets. The mix of railcar types included in the acquisition is an excellent fit for our growing GBXL portfolio. The fleet allows us to better serve our existing customers and engage market participants previously unaddressed by Greenbrier. Additionally, the transaction will generate attractive returns, delivering further value to our shareholders.”
In other developments, Greenbrier in August completed $1.5 billion of refinancing activity (https://www.railwayage.com/news/supply-side-the-greenbrier-companies-trane-technologies/?RAchannel=home) and reported receiving new orders for 5,500 railcars valued at more than $530 million during its fourth fiscal quarter that began on June 1, 2021.