US-based freight rail equipment and services provider Greenbrier Companies has implemented an agreement to increase its stake in Brazil’s Amsted-Maxion Equipamentos E Serviços Ferroviários (Greenbrier-Maxion) from 19.5% to 60%.
Capturing more 60% share of new railcar production in Brazil, Greenbrier-Maxion currently provides a range of aftermarket services that include railcar overhaul and refurbishment to ageing fleets.
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Announced in May 2015, the newly exercised deal includes an investment of $20m by Greenbrier.
The investment will be used to cut debt at Greenbrier-Maxion, reducing interest payments by $4m annually.
Greenbrier chairman and CEO William Furman said: "Brazil's economic, business and political conditions are recovering and forecasts indicate positive GDP growth in 2017. Greenbrier's operations in Brazil, and our relationship with our partners Amsted and Iochpe, continue to yield positive results.
“Our facilities, which include the largest railcar assembly plant in South America, continue to gain momentum. In two short years, we have already brought innovation to the South American railcar market.
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By GlobalData“We introduced two new products to Brazil, a new triple hopper grain car and a modern double stack railcar design, drawing on our North American heritage as the leader in intermodal railcars.
"We are expanding our investments in Brazil to reach customers who need high-quality transportation equipment and in pursuit of continued growth and further diversification of Greenbrier's global business into new markets."
Furthermore, the deal has also reduced the share of Amsted-Maxion Fundição E Equipamentos Ferroviários (Amsted-Maxion Cruzeiro), the co-owner of Greenbrier-Maxion, from 80.5% to 40% in the company.
The newly concluded investment has also enabled Greenbrier to increase its ownership stake in Amsted-Maxion Cruzeiro from 19.5% to 24.5% for $3.25m.
