American Railcar Industries, Inc. Announces Plans to Invest in Railcar Leasing
ST. CHARLES, Mo. --(BUSINESS WIRE)-- American Railcar Industries, Inc. (NASDAQ:ARII - News) (the “Company” or “ARI”) announced today that it plans to invest in railcar leasing as it seeks to expand and diversify its business in response to customer demands and market conditions. The Company remains Agile, Responsive and Innovative in responding to new opportunities to support its customers.
“ARI is very excited to offer railcar leasing and provide another option for customers to utilize our quality railcars,” said President and CEO James Cowan. “We remain committed to meeting the needs of our customers. The economy and railcar market have been challenging over the last couple of years and ARI is responding to those challenges with an expanded market strategy.”
ARI has excellent customer relationships in the railcar industry through sales of new railcars, railcar repair, refurbishment, and fleet management services. Through railcar leasing, ARI intends to provide customers with a broader offering of services.
ARI is currently in negotiations with American Railcar Leasing LLC (“ARL”), an affiliate, to enter into an agreement pursuant to which ARL would identify potential leasing customers for ARI in exchange for fees payable by ARI to ARL. ARL is well-known in the railcar industry and has long-standing relationships with customers that exclusively lease railcars. ARL is controlled by Mr. Carl C. Icahn, the Company’s principal beneficial stockholder (through Icahn Enterprises L.P.) and the chairman of the Company’s board of directors. Any agreements with ARL are the product of arm’s length negotiations and are approved by the independent directors of the Company’s board of directors.
ARI also anticipates that the leasing business will provide a more consistent stream of cash flows and revenue, which management expects would diversify the Company and improve performance during the down cycles of the railcar market. ARI currently plans to fund leasing operations through existing cash. As of September 30, 2010, ARI reported cash of approximately $310 million. Investing existing cash in railcars built to order for leasing customers is expected to enhance returns.
About American Railcar Industries, Inc.
American Railcar Industries, Inc. is a leading North American manufacturer of hopper and tank railcars. ARI also repairs and refurbishes railcars, provides fleet management services and designs and manufactures certain railcar and industrial components used in the production of its railcars as well as railcars and non-railcar industrial products produced by others. ARI provides its railcar customers with integrated solutions through a comprehensive set of high quality products and related services. ARI is controlled by Mr. Carl C. Icahn, the chairman of ARI’s board of directors, through his affiliate, Icahn Enterprises L.P.
“ARI is very excited to offer railcar leasing and provide another option for customers to utilize our quality railcars,” said President and CEO James Cowan. “We remain committed to meeting the needs of our customers. The economy and railcar market have been challenging over the last couple of years and ARI is responding to those challenges with an expanded market strategy.”
ARI has excellent customer relationships in the railcar industry through sales of new railcars, railcar repair, refurbishment, and fleet management services. Through railcar leasing, ARI intends to provide customers with a broader offering of services.
ARI is currently in negotiations with American Railcar Leasing LLC (“ARL”), an affiliate, to enter into an agreement pursuant to which ARL would identify potential leasing customers for ARI in exchange for fees payable by ARI to ARL. ARL is well-known in the railcar industry and has long-standing relationships with customers that exclusively lease railcars. ARL is controlled by Mr. Carl C. Icahn, the Company’s principal beneficial stockholder (through Icahn Enterprises L.P.) and the chairman of the Company’s board of directors. Any agreements with ARL are the product of arm’s length negotiations and are approved by the independent directors of the Company’s board of directors.
ARI also anticipates that the leasing business will provide a more consistent stream of cash flows and revenue, which management expects would diversify the Company and improve performance during the down cycles of the railcar market. ARI currently plans to fund leasing operations through existing cash. As of September 30, 2010, ARI reported cash of approximately $310 million. Investing existing cash in railcars built to order for leasing customers is expected to enhance returns.
About American Railcar Industries, Inc.
American Railcar Industries, Inc. is a leading North American manufacturer of hopper and tank railcars. ARI also repairs and refurbishes railcars, provides fleet management services and designs and manufactures certain railcar and industrial components used in the production of its railcars as well as railcars and non-railcar industrial products produced by others. ARI provides its railcar customers with integrated solutions through a comprehensive set of high quality products and related services. ARI is controlled by Mr. Carl C. Icahn, the chairman of ARI’s board of directors, through his affiliate, Icahn Enterprises L.P.