Copyright 2007, Traffic World, Inc.
Rail investments have been a hot target for private equity firms, and that also extends to rail-related information.
The Carlyle Group said it took a majority stake in RMI, a provider of rail information technology services.
Atlanta-based RMI, which markets the RailConnect Internet portal, said it processes about 7 million carloads of rail shipments each year, by working with freight shippers, railcar owners and the railroads.
The logistics IT company counts among its clients a range of players in the supply chain - short lines and regional carriers, Class I and terminal switching railroads, railcar lessors, barge operators and shippers.
Carlyle said RMI''s operating structure will not change, and that its management team will remain in place.
The companies did not disclose terms of their deal, which is the latest in a flurry of rail investments either by private equity investors or hedge funds.
Some of those include the purchase of regional lines such as Florida East Coast by Fortress Investment Group, which had already bought the RailAmerica short line firm and is also acquiring container and chassis lessor Interpool.
While equity funds often buy companies to resell at a profit, this year has also seen well-known investors taking what could be long-term positions in Class I carriers, such as Warren''s Buffett''s purchase through Berkshire Hathaway of a large stake in BNSF Railway and other lines, and TCI Fund Management''s stake in CSX.
Carlyle''s portfolio has included varied manufacturers and the Horizon shipping line that handles large container volumes between the mainland United States and Alaska, Hawaii and Puerto Rico. Carlyle acquired Horizon, then known as CSX Lines, from rail operator CSX Corp. in a 2003 recapitalization deal, and sold it to another private equity fund the next year. Horizon went public in 2005.
J. Peter Kleifgen, RMI''s chief executive, said the Carlyle transaction was a chance "to re-capitalize the company by bringing in a new equity investor. Carlyle''s extensive knowledge of the transportation sector, as well as its global network, will enable us to further the growth of our business."
With it, he said RMI will be able "to continue to pioneer new technologies and industrywide initiatives, as well as to develop new business in related markets."