Written by: William C. Vantuono, Editor-in-Chief The Greenbrier Companies, Inc. and Astra Rail Management GmbH on Oct. 13 announced formation of Greenbrier-Astra Rail, a new company “that will create an end-to-end, Europe-based freight railcar manufacturing, engineering and repair business. The enterprise will consist of Greenbrier’s European operations headquartered in Swidnica, Poland, and Astra Rail based in Germany and Arad, Romania. Greenbrier-Astra Rail will be headquartered in the Netherlands and will have principal operations in Poland and Romania. With nearly 4,000 employees and six production and repair facilities across Europe, it “will offer premier freight railcar sales, manufacturing and repair operations on the European continent,” Greenbrier said. “The railcar fleet in Western Europe is aging, with an average age of 25 years. This replacement demand, combined with anticipated growth in Europe and opportunities in nearby emerging markets, positions Greenbrier-Astra Rail for success.” Led by a Europe-based management team from both companies, Greenbrier-Astra Rail “will offer manufacturing and service capability in Europe with greater scale and efficiency for current customers” and will also “provide the opportunity to pursue growth in railcar markets in the Gulf Cooperation Council (GCC) nations and Eurasia,” Greenbrier noted. Greenbrier-Astra Rail will include all European operations of both companies, which operate three locations with new railcar manufacturing, engineering and repair services. Greenbrier’s sites are in Poland and Astra Rail’s sites are in Romania. Greenbrier also maintains a sales office in Germany. Additionally, Astra Rail performs railcar design at a facility in Slovakia. Contracts with GCC-based customers for U.S.-type freight railcars will continue to be designed and manufactured under the direction of Greenbrier’s senior U.S. manufacturing team. Greenbrier-Astra Rail will be controlled by Greenbrier with an approximate 75% interest. Astra Rail Chairman Thomas Manns will own the remainder of the new company. In addition to his ownership stake, Manns will become Chairman of the Supervisory Board of Greenbrier-Astra Rail and will lead the new company’s commercial operations, working closely with its Management Board and Jim Cowan, President of Greenbrier International. As partial consideration for its majority interest, Greenbrier will pay Astra Rail €30 million at closing and €30 million 12 months after closing. Greenbrier expects the transaction to be accretive to earnings per share by the end of fiscal year 2017. Closing of the transaction is contingent on, among other conditions, achieving antitrust approval in certain EU countries. Also serving on the Supervisory Board will be Bill Furman, Chairman and CEO of Greenbrier; Alejandro Centurion, President of Greenbrier Global Manufacturing Operations; and Cowan. Daily operations will be led by a Management Board including Bernd Böse, CEO of Astra Rail, who will become CEO and President, and Bogdan Lesnianski, CFO and the head of Greenbrier’s Wagony Swidnica operations, who will become CFO. The leadership team “has decades of experience in railcar markets throughout Eastern and Western Europe, as well as experience in emerging markets around the world,” Greenbrier said. “Greenbrier is committed to pursuing strategic opportunities for growth afforded by shifts in global demand for railcars,” said Bill Furman. “Greenbrier-Astra Rail extends our core competency in freight railcar building, aftermarket services and engineering for all railroad gauges, with a network spanning from North and South America to all of Western Europe, the GCC and Eurasia. This will be a significant and positive step in our strategy for diversification, and Astra Rail is a great partner. They bring new products to us as we do to them, and our present businesses are not directly competitive. Combining the Greenbrier Europe operations with Astra Rail’s manufacturing and design capabilities and strong management team will be a benefit to our shared European railcar customers by creating a more efficient and responsive manufacturer that offers a broad range of products. The combined enterprise will bring increased scale in Europe. Importantly, it also will bring the capability to serve new global markets in places of increasing demand. “Coupled with our investments in Saudi Arabia, Brazil and Mexico, Greenbrier has grown its international footprint and created a global network. We are capable of supporting many markets from our global facilities, including an expanded platform in Europe, as we engage developing markets in the GCC, Africa and Eurasia. We believe there are significant future opportunities in international markets. Our integrated business model ensures we are well positioned to help customers globally with rail solutions.” “By combining the European operations of Greenbrier and Astra Rail, we will create a company that will be stronger and more able to pursue future growth opportunities in the European region and beyond,” said Thomas Manns. “This combination will expand our base of executive talent and will grow our engineering and technical resources for the support and development of freight railcar manufacturing and services throughout the world. I look forward to leading the team to future success, along with Bernd Böse and Bogdan Lesnianski, as well as fellow Greenbrier-Astra Rail Directors Bill Furman, Alejandro Centurion, and Jim Cowan.” In 1998, Manns, then 21, stepped in to run his family’s business of commercial vehicle rentals upon the death of his father. After selling the business in 2008, he entered the real estate business in Eastern Europe and Germany. In 2012, he purchased Astra Rail properties, and with Bernd Böse built the business into a profitable operation with three manufacturing, engineering and repair factories in Arad, Severin and Caracal, Romania. Continue reading...
