The Greenbrier Companies, Inc. has closed on the previously announced acquisition for $10 million of a 19.5 percent ownership stake in Amsted-Maxion Cruzeiro, a manufacturer of castings and components for railcars and other heavy equipment.
Based in Cruzeiro, Brazil, Amsted-Maxion Cruzeiro is also owned by Amsted Rail Brasil (Amsted) and Iochpe-Maxion S.A. (Iochpe), who each hold 40.25 percent of the company. Amsted-Maxion Cruzeiro will use Greenbrier's investment to pay down outstanding debt and position the company for future growth.
Amsted, Iochpe and Greenbrier are parties to a shareholders' agreement that provides Greenbrier customary minority governance protections in Amsted-Maxion Cruzeiro. As part of this investment, Greenbrier also holds an option, subject to certain conditions, to acquire an additional 10 percent interest in Amsted-Maxion Cruzeiro.
Amsted-Maxion Cruzeiro serves a range of transportation equipment markets throughout Latin America and also supplies components for heavy equipment used in agriculture, mining and other industrial applications. Net sales of Amsted-Maxion Cruzeiro totaled approximately $100 million in calendar 2015.
Amsted-Maxion Cruzeiro is also the co-owner with Greenbrier of Amsted-Maxion Equipamentos E Serviços Ferroviários S.A. (Greenbrier-Maxion), the Brazilian railcar manufacturer based in Hortolândia.
As part of its initial investment in Greenbrier-Maxion, Greenbrier secured an option to acquire an additional 40.5 percent direct ownership interest in Greenbrier-Maxion. The option has been modified to allow Greenbrier to purchase an additional direct ownership interest in Greenbrier-Maxion at any point in a range between 30.6 percent and 40.5 percent, with the option exercise price adjusted in proportion to the ownership interest obtained.
"We are pleased with the progress made at Greenbrier-Maxion over the past year together with our partners Amsted and Iochpe," said William A. Furman, Chairman and CEO. "Global markets are important for Greenbrier and a significant part of our business strategy. I am pleased to expand our partnership in Brazil with Amsted and Iochpe beyond railcar manufacturing into castings and components for railcars and other heavy equipment."