Textainer Group Holdings, the Bermuda-based global lessor of containers with a secondary listing on the JSE, is going private through a $2.1 billion (R40bn) buyout by investment firm Stonepeak that will pay shareholders 46% more than the share price on Friday.
Textainer’s share price shot up 40% yesterday morning after the group said shareholders would receive $50 per share in cash. The share price traded at R926.90 on the JSE yesterday morning as shareholders closed the discount from the offer price.
Stonepeak specialises in infrastructure and real assets. In its transport and logistics sector investments, the company invests “in support of businesses moving toward and benefiting from global thematic trends favouring more efficient and sustainable supply chains”.
Textainer will delist and become a privately held company once the deal is completed and Textainer’s Series A and B preference shares were redeemed.
Textainer said in a statement that its board unanimously approved the transaction and Textainer common shareholders would receive $50 per share in cash, with the total value of the shares equal to about $2.1bn.
This transaction represents an enterprise value of about $7.4bn, and the purchase price represented a premium of about 46% over Textainer’s closing share price on Friday, the last trading day prior to the deal announcement.
Olivier Ghesquiere, the president and CEO said: “By partnering with Stonepeak, we will gain access to investment capital and industry expertise, positioning us for continued growth in the years to come.”
He said the transaction was made possible by a strong foundation laid over several years that allowed for substantial capex growth and strengthening of the business, driven also by “deep customer relationships”.
“After 16 years of operating in the public equity markets, we are very excited to start this new chapter as a private company. We’re particularly proud to have delivered a transaction that creates significant and immediate value for our common shareholders,” said chairperson Hyman Shwiel.
He said that with Stonepeak as a partner they would be well positioned to continue delivering high-quality equipment and ‘best-in-class service’ to customers.
“Textainer forms a critical link in global trade. The business is underpinned by high-quality assets and contracted cash flows that provide substantial downside protection and resilient through-cycle performance,” said Stonepeaks senior MD James Wyper.
“These characteristics, along with Textainer’s commitment to customers and disciplined approach to capital expenditure, are what make the company a leader in the sector. We look forward to working closely with Textainer to help further their strategy and growth.”
The transaction was expected to close in the first quarter of 2024.
The merger agreement includes a 30-day “go-shop” period, which permits Textainer and its financial adviser to continue to actively solicit and consider alternative acquisition proposals.
Textainer would continue to be led by Ghesquiere after the transaction, and would continue to be headquartered in Hamilton, Bermuda.
Textainer’s headline earnings fell to $51.3 million in the second quarter, or $1.20 per diluted common share, compared to $53.6m, or $1.22 per share in the first quarter of 2023. Its second quarter average and current container utilisation rate was at 98.8% and 98.9% respectively.
A second quarter $0.30 per common share cash dividend was paid.
Stonepeak’s other transport investments include in TRAC Intermodal, a company that provides infrastructure for the movement of containers to and from ports across the US, forming the backbone of the US’s intermodal supply chain. Stonepeak is also invested in LIneage, one the world’s largest temperature controlled logistics companies.