Vauban, Swiss Life set sights on German rail

The offer represents a 38.6% premium to Aves One’s three-month volume-weighted average share price, giving it an enterprise value of €1bn.

Vauban Infrastructure Partners and Swiss Life Asset Managers have submitted a public takeover bid, offering €12.80 for every outstanding share – 13.02 million shares in total – of Aves One, a railcar leasing company based in Hamburg and listed on the Frankfurt Stock Exchange.

The offer price, which totals roughly €166.4 million, represents a premium of around 38.6 percent to the three-month volume-weighted average share price on 5 August, Paris-based Vauban said in a statement. It also gives the company an enterprise value of €1 billion, according to Aves One.

Vauban and Swiss Life, which are equal partners, have also agreed to provide Aves One with an additional €100 million “as well as potential further capital to optimise the capital structure of Aves One AG and finance further growth”, the German company said in a statement.

Aves One has operated with a significant amount of leverage. According to data from S&P Global Market Intelligence, the company’s net debt stood at €845 million in 2018, €942 million in 2019 and €967 million in 2020.

“Great assets and enhancing the capital structure are some of the main drivers for this investment,” Vauban senior investment director Christoph Bruguier told Infrastructure Investor.

“There is a push for greener transport, but also a need in the market for fleet renewal, [which] provide a strong case for the rail freight business,” he added.

The EU is placing intense focus on the sector, dubbing 2021 as the “European year of rail”. Within the context of the European Green Deal, Brussels aims to double rail freight and triple high-speed rail activity by 2050, the same year it hopes to achieve climate neutrality.

Another factor that attracted Vauban to Aves One is its portfolio of more than 11,000 railcars. “Here, you have a young and high-quality fleet, so the whole point is to further develop the company,” Bruguier said.

Aves One also has more than 9,000 swap bodies or freight containers, but railcars represent 94 percent of its assets in terms of net book value.

Should the bid be accepted – 85 percent of shareholders have already committed to selling their shares – Vauban will be making the investment through the Core Infrastructure Fund III, which it closed on its €2.5 billion hard-cap in July. It would also mark Vauban’s first investment in the rail sector and its first in Germany.

According to Bruguier, the two partners will file the offer document with the German Federal Financial Supervisory Authority (BaFin) in the following weeks. Once it’s approved, an acceptance period will be agreed upon for shareholders to accept or refuse the offer.

It is unclear whether Aves One will be delisted if and when the sale occurs.

Vauban and Swiss Life have been targeting the rail sector for some time. In April, they teamed up with Australian Super to bid for Ermewa, the wagon leasing company of French national railway operator SNCF, but lost out to CDPQ and DWS.

Last month, Vauban announced the appointment of Patrick Jeantet as a senior adviser dedicated to the rail sector. According to a statement issued at the time, Jeantet has more than 35 years’ experience in the sector, most recently serving as chair of Keolis Group, an SNCF subsidiary, since February 2020. Prior to that, he was vice chair of the SNCF Group and chair and chief executive of SNCF Réseau from May 2016 through February 2020.