Brookfield Infrastructure Partners LP agreed to buy Triton International Ltd., the world’s largest owner of intermodal shipping containers, for $4.7 billion to expand in transportation logistics supporting the global supply chain.
(Bloomberg) — Brookfield Infrastructure Partners LP agreed to buy Triton International Ltd., the world’s largest owner of intermodal shipping containers, for $4.7 billion to expand in transportation logistics supporting the global supply chain.
Toronto-based Brookfield will pay $85 a share, including $68.50 in cash, the companies said early Wednesday, which is a 35% premium to Triton’s closing price Tuesday. The acquisition, which needs the approval of Triton shareholders and regulators, is expected to be completed in the fourth quarter.
Triton rose 32% to $83.06 as of 12:31 p.m. in New York, while Brookfield Infrastructure shares were little changed.
“Triton is an attractive business with highly contracted and stable cash flows, strong margins and a track record of value creation,” Brookfield Infrastructure Chief Executive Officer Sam Pollock said in a statement. The transaction bring “strong downside protection and a platform for growth in the transportation and logistics sector,” he said.
Including debt, the deal is worth $13.3 billion.
‘Attractive’ Yield
While deal flow was expected to slow down this year, the acquisition brings “an attractive estimated going-in cash yield of 13-15%,” National Bank analyst Patrick Kenny said in a note to clients.
Global supply chains were disrupted for years by the Covid-19 pandemic, though pressures have eased lately. Shipping delays, plus the war in Ukraine, have disrupted manufacturing and caused food shortages, adding to inflation.
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Triton’s shares had doubled in the past three years before Wednesday’s deal announcement. The firm, which is based in Bermuda and listed on the New York Stock Exchange, has a fleet of more than 7 million 20-foot-equivalent container units.
After closing, Brookfield Infrastructure’s equity investment is expected to be about $1 billion, including shares of the Canadian company.
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