Wabtec has acquired RELCO Locomotives, a long-established player in the locomotive overhaul and maintenance industry.
The acquisition expands Wabtec’s freight services capabilities and capacity to support growth in the remanufacturing and repair business, the company said.
“This acquisition will unlock tremendous value for our customers, employees and shareholders,” said Rafael Santana, Wabtec president and CEO. “The complementary combination of our portfolios will create aftermarket services growth and the development of new, innovative solutions to drive improved asset utilization and reduced operating cost for customers.”
The purchase price for the transaction was US$29 million, on a cash-free and debt-free basis. All conditions for the acquisition are complete and the transaction will be accretive in year 1. RELCO’s projected sales for 2019 are roughly $50 million. RELCO Locomotives, which also has leasing capabilities, has operations in Albia and Cedar Rapids, Iowa.
“Today marks an exciting day for Wabtec’s services business and will further strengthen our portfolio,” said Pascal Schweitzer, Wabtec’s Group president, Freight Global Services Organization. “By leveraging Wabtec’s robust remote monitoring and diagnostics and predictive maintenance capabilities, as well as our focus on lean continuous improvement, we will build upon RELCO’s deep product offering, track record of service quality and engineering creativity for locomotive modernizations. We are excited about the long-term opportunities before us and are pleased to welcome Mark Bachman and the RELCO team to the Wabtec family.”
Early in 2019, Wabtec Corp. completed its merger with GE Transportation, a former business unit of GE. The merger combined Wabtec’s range of freight, transit and electronics products with GE Transportation’s equipment, services and digital solutions in the locomotive, mining, marine, stationary power and drilling industries. Through its subsidiaries, the company manufactures a broad range of products for end markets such as locomotives, freight cars, passenger transit vehicles and power generation equipment, for both original equipment and aftermarket applications. Wabtec also builds new locomotives up to 5400 HP, and provides aftermarket maintenance and services for locomotives and passenger transit vehicles.