SNCF Fret locomotive

Sale of SNCF’s freight locomotive leasing company enters home stretch


SNCF is continuing its strategy of disposing of non-strategic assets after moving out of the red last year thanks largely to the €3.2 billion sale of its rail wagon leasing company, Ermewa.

According to French business newspaper, Les Echos, France’s state railways has triggered the sale of its freight locomotive leasing company, Akiem and is being advised by investment bank, Rothschild.

It said the deadline for the submission of “non-binding” offers for the subsidiary, which SNCF co-owns 50/50 with the German infrastructure asset manager DWS, passed earlier this week. Together, they hope to make around 2.5 billion euros from the sale.

Several potential bidders

After an initial selection of candidates, SNCF and DWS will draw up a short list this with a view to deciding on firm offers at the end of June or beginning of July.

Among the bidders is said to be Canada’s Caisse de Dépôt et Placement du Québec (CDPQ), which, in association with DWS, acquired Ermewa in October last year. Also in the running is French infrastructure fund, Vauban, which was also a candidate to acquire Ermewa. The investor is currently in the process of conducting a takeover bid for German wagon hire company, Aves One.

According to unidentified sources, quoted by Les Echos, Sweden’s EQT is also interested and has joined forces with EDF Invest, another rejected Ermewa suitor. The infrastructure fund Infravia, which has just raised some €5 billion, is also said to be studying the Akiem dossier.

Competitors in the running

In addition to financial investors, Akiem’s direct competitors are also expected to submit bids, including the UK’s Beacon Rail while other medium-sized players have asked to examine the company’s data file such as Alpha Trains (Luxembourg), Angel Trains and Porterbrook (UK) and Germany’s Railpool.

“There is a real potential for business growth because freight is part of the decarbonisation plans with the switch from road to rail and there is an investment plan to be carried out in the electrification of the fleet. The market share of locomotive hire is still small compared to that of wagon leasing, so the potential for outsourcing is strong,” people close to the matter told Les Echos.

In total, Akiem, a company created in 2008 with the opening of the French freight market to competition, has some 600 locomotives in its portfolio, “the largest fleet on the continent”, operating in 17 European countries. Its fleet grew in 2020 with the acquisition of Macquarie European Rail’s equipment rental business (137 locomotives and 30 additional trains).

Strong growth outlook

European rail freight is viewed as having strong potential for growth between now and 2030, according to a recent study by ECM Ventures for ERFA, the association of European rail operators.

This is particularly true in France, where the modal share of rail has long since plateaued at 9% of total freight transport, compared with the European average of 18%. In France, the government’s recovery plan makes provision for specific aid to the rail freight sector of around 170 million euro annually.

Author: Stuart Todd

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