KKR Infra to sell ELL for EUR 1bn EV

20 December 2019 - 12:00 am UTC

AXA Investment Managers and Credit Agricole Assurances have agreed to buy European Locomotive Leasing (ELL) from KKR Infrastructure for an enterprise value of around EUR 1bn. 

KKR Infrastructure said on Friday (20 December) that it had signed an agreement with the buyers to acquire its 100% stake in ELL, which leases around 150 electric locomotives to some 20 European freight and passenger rail operators. 

The sale price represents an EV/EBITDA value of around 19 times based on projected 2019 EBITDA, a source close to the situation said.

In December 2018, Morgan Stanley Infrastructure Partners acquired a 70% stake in VTG, valuing the German railcar lessor at 13 times its adjusted 2018 EBITDA.

The two buyers, which are each taking 50%, beat competition for the business from PGGM and a team of MEAG and Partners Group. One bank is expected to underwrite acquisition debt for the transaction and later syndicate some of it, the source close said.

AXA IM acquired a 15% equity stake in the first phase of the UK’s Intercity Express Programme, which includes the financing of the construction and maintenance of 92 high-speed trains, for GBP 227.5m from John Laing Group in March 2018.

Crédit Agricole Assurances, the insurance arm of the French financial services company Crédit Agricole group, bid unsuccessfully in 2015 for a 40% stake in Eurostar, the high-speed passenger train service between the UK, France and Belgium, eventually sold to CDPQ and Hermes Infrastructure for GBP 585m.

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