News Mar 30, 2015

Arcapita Sells Freightliner For Approximately $800 Million

Arcapita, the global investment management firm, announced today the sale of Freightliner Group Limited (“Freightliner”), an international rail freight operator, to Genesee & Wyoming Inc., a US-based international owner and operator of short line and regional freight railroads. Consideration for 100% of the shares was approximately US$800 million (£525 million) and the assumption of liabilities. Freightliner management will continue to hold an approximate 5% ownership interest post sale.

Headquartered in London and with over 2,500 employees, Freightliner is a leading UK rail logistics company, moving containers and heavy goods between ports and inland distribution hubs. The company was privatized from British Rail in May 1996 via a management buyout. The business operates primarily in Great Britain and is actively pursuing international growth. Freightliner has four main operating subsidiaries: Freightliner Intermodal, the largest inland hauler of maritime containers in the UK; Freightliner Heavy Haul, transporting coal, aggregates, cement and petroleum; Freightliner International, currently operating in Poland and Australia, and in several other European countries through its subsidiary ERS Railways; and Freightliner Maintenance, the company’s in-house provider of fuelling and maintenance services.

Martin Tan, Arcapita’s Chief Investment Officer, said, “Since Arcapita’s acquisition of Freightliner in 2008, the company has grown its revenues by 87% and EBITDA by approximately 70%, despite the slow European economic recovery following the global financial crisis. The management team, working with the Freightliner board, have transformed Freightliner into a global rail business, by extending operations to the Middle East, Australia and across continental Europe, completing accretive add-on acquisitions while growing the core UK business.”

Atif A. Abdulmalik, Arcapita’s Chief Executive Officer, commented, “We are very pleased that the investment in Freightliner has resulted in a profitable outcome for our investors. Arcapita’s European private equity investment and portfolio management teams have supported Freightliner’s highly-professional management team and significantly enhanced the company’s growth. The sale of Freightliner follows a series of other successful exits achieved in the US and the Middle East in recent months. We continue to focus on delivering a number of other significant exits within our global investment portfolio in the near term while also working on closing new investment opportunities inthe GCC region, US and Asia.”