Status Realised (2015)
Overview
- Sector transport
- Vehicle AEIF1
- Investment Year 2008
- Country UK
Key Metrics
- Ownership 43.4%
- Employees c.120
- Market Share 34%
- Passenger Vehicles c.4,300
Investment Rationale
- Rail is a popular transport choice in the UK and new trains are required to be built to meet rising passenger demand and for future electrification.
- Rolling stock owners provide a key infrastructure asset to rail service operators under medium to long-term contracts insulated from passenger demand risk.
- Rolling stock assets present a 30 years expected asset life and we identified significant opportunities for extensions and upgrades, which bring economic benefit to the owner.
- Growing passenger demand and high visibility of future tendering processes result in very high utilisation rates for existing assets and accretive new build opportunities.
- Rolling stock companies enjoy very robust cashflows and dividend yields, with upside arising from asset improvement and new build opportunities.
Asset
- In August 2015, the fund completed the sale of its entire stake in Angel to existing shareholders, at a return well above the entry investment case.
- During the Arcus ownership period, Angel expanded its rolling stock portfolio and invested £690 million in new build opportunities, procuring 336 additional vehicles.
- Angel achieved 12% EBITDA growth during the period Arcus held the investment.