Meanwhile, the Lake Oswego, Ore.-based transportation equipment manufacturer recorded a 38 percent year-over-year boost in revenues for the quarter ending Feb. 28, 2017, fueled by higher wheel volumes and externally sourced railcar syndications.
The Greenbrier Companies, Inc., a Lake Oswego, Ore.-based railroad transportation equipment manufacturer, signed a memorandum of understanding (MOU) with Tokyo-based global leasing company Mitsubishi UFJ Lease & Finance (MUL) to expand their existing commercial relationship in North America.
The combined value of the transaction exceeds $1 billion, Greenbrier said Wednesday.
MUL intends to increase its portfolio from 5,000 railcars (which Greenbrier currently manages) to 25,000 railcars over the next few years.
The MOU includes a multi-year purchase commitment by MUL for 6,000 newly-manufactured railcars from Greenbrier through 2020, and MUL has committed to obtain all of its newly-manufactured railcars exclusively from Greenbrier through 2023.
In addition to the new equipment ordered, MUL will supplement its portfolio growth over the next few years through a combination of lease syndications and used equipment owned and originated by Greenbrier.
Under the MOU, both parties will form a new asset management services entity, owned 50 percent by each company, solely for railcars in the MUL fleet. The 5,000 railcars Greenbrier currently manages will now be managed by this new entity.
Greenbrier will collect fee income from MUL related to its railcar asset management services.
Greenbrier did say the agreements reached with MUL are subject to agreements on remaining terms, completion of documentation, and other customary conditions.
In addition to the MOU with MUL, Greenbrier also experienced a boost in net earnings and revenues for its second fiscal quarter, which ended Feb. 28, 2017.
During the quarter, net earnings attributable to the company surged 38 percent from the corresponding prior year period to $34.5 million.
Revenues for the quarter ticked up 2.5 percent year-over-year to $566.3 million, primarily driven by higher wheel volumes and externally sourced railcar syndications.
Diversified orders for 700 new railcars were received during the quarter, valued at approximately $50 million, or an average price of about $71,000 per railcar, while new railcar deliveries totaled 3,900 units.
Greenbrier inks railcar deal with MUL exceeding $1b
