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DGAP-News: Nacco takeover successfully closed: More than 11,000 railcars added to VTG's fleet

DGAP-News: VTG Aktiengesellschaft / Key word(s): Takeover/Miscellaneous

05.10.2018 / 08:41
The issuer is solely responsible for the content of this announcement.

Nacco takeover successfully closed: More than 11,000 railcars added to VTG's fleet

- Further diversification of the VTG portfolio and a stronger presence in Europe

- VTG fleet grows from over 83,000 to more than 94,000 railcars

- Acquisition expected to contribute EUR 85 million to revenue and EUR 70 million to EBITDA in 2019

- Transaction financed by senior loans and a privately placed hybrid bond

- Antitrust conditions met by sale to bidding consortium

Hamburg, October 5, 2018. VTG Aktiengesellschaft (WKN: VTG999), one of the leading railcar leasing and rail logistics companies in Europe, is acquiring CIT Rail Holdings (Europe) SAS and the associated Nacco Group. On October 1, 2018, a bidding consortium comprising railcar leasing firm Wascosa AG (Lucerne, Switzerland) and publicly traded Aves One AG (Hamburg) had already purchased those parts of the Nacco Group that needed to be sold to comply with conditions imposed by the German and Austrian antitrust authorities. Taking over the Nacco Group enlarges and adds to the diversity of VTG's railcar portfolio, while at the same time further increasing availability for customers in Europe.

"The Nacco takeover will strengthen our market position in Europe for a long time to come," says Dr. Heiko Fischer, Chairman of the Executive Board of VTG Aktiengesellschaft. "That's why we are pleased to finally be able to close out the transaction - despite the reduced scope - and to reinforce our position as a potent, forward-looking partner for rail transportation." Like VTG's existing European fleet, the Nacco railcars too will be fitted with VTG Connectors in the years ahead. This step - a logical continuation of VTG's innovation and digitization strategy - is creating a network of digitally connected freight cars that is unrivaled on the market.

On July 1, 2017, VTG first announced its intention to acquire all shares in Paris-based CIT Rail Holdings (Europe) SAS, the owner of the Nacco Group, off the American CIT Group. The relevant antitrust authorities approved the acquisition at the end of March 2018, subject to certain conditions. The sale of a railcar package to the bidding consortium has now satisfied the antitrust requirements.

The Nacco fleet that VTG has now acquired is a well-balanced portfolio of about 11,000 freight cars covering all the most common segments. The key markets for this portfolio are the UK, Scandinavia, the Netherlands, Belgium, Austria, France, Italy and Eastern Europe. Depending on the capital investments Nacco has continued to make in 2017 and 2018, VTG expects its new acquisition to add extra revenue of around EUR 85 million and extra EBITDA (earnings before interest, taxes, depreciation and amortization) of roughly EUR 70 million in 2019 (before transaction and integration costs).

Revenue and earnings effects from the Nacco transaction were explicitly excluded from the existing Group forecast for the financial year 2018. Now that the acquisition has been completed, the said revenue forecast (slightly higher than in the prior year) and the EBITDA forecast (between EUR 340 million and EUR 370 million) are no longer valid. However, since revenue and earnings effects from first-time consolidation of the Nacco Group as of the start of October cannot reliably be quantified at short notice, VTG will not update its forecast for the financial year 2018 for the time being. Without the effects of the Nacco transaction, the forecast would remain unchanged.

VTG is financing the transaction with a senior loan of some EUR 375 million, a privately placed hybrid bond of up to EUR 300 million and the utilization of an existing senior loan of approximately EUR 80 million. The hybrid bond will be refinanced on the capital market. To this end, a rights issue is planned to increase VTG's capital out of authorized capital.

About VTG:

VTG Aktiengesellschaft is one of Europe's leading railcar leasing and rail logistics companies, with a fleet consisting of more than 94,000 railcars. VTG offers a full-range service, providing tank cars, intermodal cars, standard freight cars and sliding wall cars. In addition to the leasing of railcars, the Group offers comprehensive multi-modal logistics services, mainly around rail transport, and global tank container transports.

With the combination of its three interlinked divisions Railcar, Rail Logistics and Tank Container Logistics, VTG offers its customers a high-performance platform for international transport of their freight. The Group has many years of experience and specific expertise, in particular in the transport of liquid and sensitive goods. Its customers include numerous well-known companies from almost every industrial sector, for example the chemical, petroleum, automotive, paper and agricultural industries.

In the financial year 2017, VTG generated revenue of EUR 1,014 million and operating profit (EBITDA) of EUR 343 million. Via its subsidiaries and affiliates the company, which has its head office in Hamburg, is mainly present in Europe, North America, Russia and Asia. As at 31 December 2017, VTG had 1,500 employees worldwide. VTG AG is listed on the official Prime Standard market of the Frankfurt Stock Exchange and also on the SDAX (WKN: VTG999).


Contact Corporate Communications: 
Gunilla Pendt 
Head of Corporate Communications 
Telephone: +49 (0) 40 23 54-1341 
Fax: +49 (0) 40 23 54-1340 

Contact Investor Relations:
Christoph Marx
Head of Investor Relations
Telephone: +49 (0) 40 23 54-1351
Fax: +49 (0) 40 23 54-1350

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05.10.2018 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.

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