SMBC to buy US rail lessor from Perella Weinberg
Perella Weinberg Partners will exit Chicago-based Flagship Rail Services to Sumitomo Mitsui Banking Corporation (SMBC) in a transaction valued at $1.1 billion.
The agreement with the SMBC Leasing and Finance unit is subject to regulatory approvals and customary closing conditions and the transaction is expected to close by the end of the year. The company will then operate as SMBC Rail Services.
The Perella Weinberg Partners Asset Based Value Strategy acquired the company as AIG Rail Services for an undisclosed sum from American International Group (AIG) in 2011. It is now the ninth-largest railcar leasing company in North America by number of railcars, with a fleet of approximately 15,000 railcars serving a broad range of industries, including energy, steel, agriculture, petrochemical and consumer goods.
"SMBC is an excellent steward, with a more competitive cost of capital and long-term commitment to the space, and we are confident Flagship Rail will continue to flourish as part of that organization," David Schiff, partner at Perella Weinberg Partners said in a statement.
SMBC has been expanding its leasing business abroad. The strategy includes a deal last year to buy the RBS Aviation Capital aircraft-leasing company from Royal Bank of Scotland for $7.2 billion.
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