JV created for railcar investment

railcar investment vehicleTrinity Industries and Wafra, an investment company, created a joint venture partnership between Trinity and certain funds managed by Wafra and established a railcar investment vehicle (RIV) programme targeting an investment of up to USD 1 billion in leased railcar sector. All the acquisitions to be made within a period of three years.

The RIV programme is structured as a new joint venture, Signal Rail Holdings, between Wafra Funds and Trinity, with Wafra Funds owning 90% and Trinity Industries Leasing Company (TILC) owning 10% of Signal Rail. TILC will continue to service all railcars owned by Signal Rail.

“We are excited to join with Wafra as the latest partner in our RIV platform. This joint venture brings together parties with aligned strategies of long-term investments in quality assets with high quality investment partners like Wafra,” Trinity’s Chief Executive Officer and President, Jean Savage, said.

In connection with the launch of the railcar investment vehicle programme, Signal Rail has acquired an initial portfolio of approximately 3,600 railcars, representing a diverse pool of on-lease railcars from TILC’s leased railcar fleet. Signal Rail financed the acquisition of these wagons through SRL 2021-1, an asset-backed securitization comprising USD 265 million in two classes of notes rated by S&P and KBRA.

The acquisition of the wagons was completed on August 18, 2021.

“Wafra is pleased to launch this partnership with Trinity, an established market and thought leader in railcar leasing and manufacture. Through this joint venture, Wafra builds on its portfolio of high-quality real asset investments. As long-term investors, we recognize the importance of forming partnerships with industry leaders like Trinity, as well as ensuring meaningful alignment as the basis of shared success,” Fawaz Al-Mubaraki, Wafra’s Chief Executive Officer said.

TrinityRail is the railcar products and services division of Trinity Industries headquartered in Dallas. The company provides railcar leasing and management services as well as railcar manufacturing, maintenance and modifications. The company offers more than 100 railcar models, which are frequently customised to customer requirements.

Wafrais manages assets and capital commitments of USD 27 billion and invests across a wide range of alternative assets, including real assets and infrastructure, private equity, strategic partnerships and real estate.

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