An affiliate of ITE Management L.P. is set to acquire SMBC Rail Services LLC from SMBC Americas Holdings, Inc., a subsidiary of Sumitomo Mitsui (NYSE:SMFG) Financial Group. This move will expand the fleet of American Industrial Transport, Inc. (AITX) by over 50,000 railcars.
This acquisition is in line with the Medium Term Management Plan of SMBC Group, which is focusing on its U.S. business and has a long-term vision of strategic reinvestment and capital reallocation to growth areas. These areas include its corporate investment bank, sales & trading division, and digital venture, Jenius Bank.
SMBC Group, a Tokyo-based global financial group with a 400-year history, offers a wide range of financial services around the world. Over the past decade, SMBC Group has transformed SMBC Rail Services LLC through fleet reinvestment and growth strategies.
On the other hand, AITX provides integrated solutions to the freight shipping market in North America. The transaction with SMBC will add over 50,000 additional railcars to AITX’s fleet, thereby improving the company's value proposition for its customers, employees, and stakeholders.
ITE Management L.P., an investment firm targeting transportation and industrial assets for investment, aims to generate current yields and long-term uncorrelated returns. Post-acquisition, AITX plans to enhance its railcar lease fleet and comprehensive repair and maintenance services.
The divestiture of SMBC Rail Services LLC aligns with SMBC Group’s commitment to focus on its U.S. business and reallocate resources towards its corporate investment bank, sales & trading division, and the newly launched digital bank, Jenius Bank.
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