post privatization
The Railpool joint venture between HSH Nordbank and KfW-IPEX
Bank has confirmed that it plans to become an equivalent player in
Germany to the UK Roscos as it seeks opportunities in the country’s
liberalising passenger and freight rail markets.
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But whereas in the UK the three Roscos – Angel Trains, HSBC Rail
and Porterbrook – inherited the incumbent British Rail rolling
stock, Railpool’s endeavours will have to be built up from
scratch.
“I don’t think the German government will give the country’s
rolling stock to the private sector like the UK government did,”
said Christian Forster, head of rail and intermodal at HSH Nordbank
in London.
“In three to five years we plan to have a portfolio of around
€500m of new equipment,” he said.
Railpool has announced it will acquire a fleet of locomotives
and passenger equipment and lease them to private rail
operators.
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By GlobalDataThe joint venture also outlined it will combine “the full chain
in banking with the value chain of a service provider in the rail
industry”.
“We are planning to start with sale and leaseback transactions
and we plan to buy several electric locomotives worth a low
triple-digit million sum,” said Michiel Munting, HSH Nordbak’s
transportation division in London.
“We’ll be taking a full-service approach including wet and dry
operating leases and finance leases as well as offering clients
corporate finance, M&A and hedging services,” he said.
While the banking groups behind the UK Roscos have been
questioned in the past because of their lack of an overall
financial services offering, the Railpool model looks set to become
a “one-stop shop” for rail operators.
Germany will be the primary target market for Railpool, which it
later plans to expand to.
The deal flow has already kicked off for Railpool since its
official launch at the end of June. “We have been visiting new
passenger operators in Germany and we have been welcomed as a
competitor there. We’ve signed a small freight deal in Germany
already,” said Forster.
Germany’s rail market is undergoing massive change, not least
with the recent confirmation by the country’s finance ministry that
it will partially privatise Deutsche Bahn later this year.
Deutsche Bahn plans to sell 24.9 per cent of shares in a
passenger and freight services subsidiary on November 5, from which
one-third of the proceeds – expected to be up to €6bn – would go
towards the federal budget.
Though its partial privatisation is likely to stimulate the rail
and transportation company to look beyond its traditional corporate
bond financing approach to other forms of financing, including
operating leasing, this is likely to be a gradual development.
“Deutsche Bahn has looked at leasing in the past and I think it
will be on a sliding scale that DB will increasingly look at
leasing in the future,” said Munting.
Meanwhile, German operators are among the M&A targets in
Europe’s burgeoning rail market. Dresden-based rail-freight
operator and logistics firm Import Transport Logistik (ITL) has
been partially acquired by French state railway SNCF, which now
owns a 75 per cent stake in the company.
Anthony O’Connor
