Trinity Buys Highway Products Firm

Trinity Industries, spreading out beyond the troubled rail equipment market, bought highway construction products manufacturer for about $61 million in cash, the railcar maker said Thursday.

The purchase expands Dallas-based Trinity’s manufacturing business, which includes barges and steel wind towers as well as a unit that provides steel support rods to the construction industry.

Trinity, which got got 60 percent of its revenue from railcar production as recently as 2000, counted just 23 percent of total sales in the 12 months ending Sept. 30, 2009 from the faltering railcar business.

Trinity had $545 million in cash on hand at the end of September and will use part of that for its new purchase.

Acquiring Quixote, a Chicago firm with a range of highway safety products for road repair crews and drivers, will help Trinity move farther from the rail supply industry, where massive numbers of idled freight cars will weigh on new orders for years to come.

Quixote taps into a market that is on a multi-year phase of heavy government spending, both from the 2009 stimulus legislation and coming highway investment as Congress prepares a new round of transportation funding plans.

Its product line includes energy-absorbing highway crash cushions, bridge anti-icing systems and truck-mounted attenuators or crash-absorber devices used by road crews to help guard against the impact risks when car drivers move out of their lanes while repairs are under way.

The two companies expect to complete the acquisition in the 2010 first quarter. Trinity will first tender for outstanding Quixote shares, and needs to get at least 60 percent. Quixote’s board has already given its unanimous approval.

Contact John Boyd at jboyd@joc.com.