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KKR may exit ELL: Bloomberg
Posted on Friday, 13 September 2019 12:14

KKR is weighing exiting its five-year-old investment ELL, an Austrian and German electric locomotive leasing company worth roughly EUR 1.00 billion, including debt, sources with knowledge of the situation told Bloomberg.

According to the people in the know, who declined to be named as the matter is private, the owner and its advisors are currently in the early stages of reviewing options.

No further information regarding the discussions was disclosed regarding the potential sale of the rolling stock company that buys the railway vehicles providing motive power for trains.

ELL leases its locomotives – and provides maintenance and management services - to freight and passenger operators throughout continental Europe.

At the time of the investment, the sector in Europe benefitted “from highly attractive market dynamics” that the company could capitalise on, according to the March 2014 statement.

The attractive factors included “rail traffic liberalisation and promotion across the continent, the growing prominence of private rail operators more likely to favour leasing rather than owning locomotives, and an improving macroeconomic outlook”.

Current news within Europe’s railway sector ranges from the European Commission proposing the extension of the tenure of the European Union Agency for Railways’ executive director Josef Doppelbauer by five years to Bouygues selling 13.0 per cent of Alstom.

A sale would join 63 other deals targeting the other commercial and industrial machinery and equipment rental and leasing segment that have been announced in 2019 to date, according to Zephyr, the M&A database published by Bureau van Dijk.

Only one of these is worth more than EUR 1.00 billion: private equity firm EQT sold Direct ChassisLink and Blume Global to Apollo for a reported EUR 2.22 billion.

If a sale of ELL went ahead with a value of roughly EUR 1.00 billion, it would be the segment’s 18th largest deal on record.

© Zephus Ltd