Paceline Equity Partners Buys Railroad MOW Equipment Lessor

Affiliates of Paceline Equity Partners, a Dallas-based private equity manager, acquired R.E.L.A.M., a lessor of railroad maintenance-of-way equipment, as well as Acme Construction and Timiny RR Construction, which are affiliated rail infrastructure and track maintenance services businesses.

Headquartered outside of Cleveland, R.E.L.A.M. provides maintenance-of-way solutions, including an equipment fleet used to maintain railroad infrastructure along with complementary track maintenance services.

R.E.L.A.M. will operate together with 1435 Rail, a lessor of railroad maintenance-of-way equipment, which was acquired by affiliates of Paceline on Dec. 31, 2019, making the combined purchase price of the two acquisitions approximately $185 million. The R.E.L.A.M. brand will be adopted by the collective enterprise, which will have a fleet of more than 1,100 pieces of maintenance-of-way equipment.

As part of the transaction, rail industry veteran John Roberts will serve as R.E.L.A.M.’s CEO. Roberts most recently served as president of Marmon Crane, a Berkshire Hathaway-owned company. Prior to that he spent more than 20 years at Railserve, a provider of in-plant railway services.

“This transaction brings together two dynamic players in the maintenance-of-way leasing market, allowing us to strategically expand our service offerings in the rental, leasing and sales verticals,” Roberts said. “I am excited about the partnership with the Paceline team and I share their enthusiasm for the numerous benefits this transaction will bring to the company’s customers, employees, and suppliers — most important of which is building on the unparalleled customer service that R.E.L.A.M. strives to provide.”

“R.E.L.A.M. is a highly strategic and complementary investment that will add to Paceline’s existing asset-rich platform in the railroad MOW space,” Sam Loughlin, CEO of Paceline, said. “We look forward to partnering with the R.E.L.A.M. team to support the company through its next stage of growth.”

“Despite the current unprecedented macroeconomic backdrop, R.E.L.A.M. has demonstrated stable cash flows driven by non-discretionary maintenance and safety-related spending, making it a highly attractive and recession-resistant investment,” Leigh Sansone, chief investment officer of Paceline, said.

“It has been a pleasure getting to know the Paceline team, who shares a like-minded enthusiasm for the railroad industry and R.E.L.A.M,” David M. Horth, owner of R.E.L.A.M., said. “This business has been in my family for over 100 years and I am confident that R.E.L.A.M. will continue to build on its record of success and growth under Paceline. I’m looking forward to my next adventure which will include continuing to work with the company through my role as an advisory board member, and I am committed to working collaboratively with John to ensure a smooth transition.”

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