GATX Corp. (NYSE:GATX) said it and Brookfield Infrastructure Partners L.P. (NYSE:BIP) have received all required regulatory approvals to complete their previously announced transaction to acquire Wells Fargo’s rail operating lease portfolio.
The transaction, first disclosed in May, will be executed through a joint venture between GATX and Brookfield Infrastructure and is expected to close on or about Jan. 1, GATX said.
Under the terms of the deal, the joint venture will acquire approximately 105,000 railcars for about $4.4 billion.
Separately, Brookfield Infrastructure will acquire Wells Fargo’s remaining rail portfolio, consisting of roughly 23,000 railcars and 400 locomotives, according to GATX.
GATX will own a 30% stake in the joint venture and will manage the equipment across the transactions.
The company also holds an option to acquire full ownership of the joint venture over time.
The transaction comes amid ongoing changes in the North American rail industry.
Analysts estimate that since 2016, following the adoption of Precision Scheduled Railroading, major freight railroads including Union Pacific, Norfolk Southern and CSX have idled or sold about 1,500 locomotives and 30,000 railcars as operators sought to maximize asset efficiency.