Porterbrook is a leading UK rolling stock company (“ROSCO”) created following the privatisation of the UK rail industry in 1994.
- Transport
Porterbrook
- Dalmore Capital Fund 4
Case study overview
Porterbrook owns and leases a diverse range of rolling stock assets and rail related equipment including regional, commuter and high-speed passenger trains to franchise operators.
The company owns a flexible fleet of c. 4,000 trains representing an estimated 25% market share, 99% of which are currently on lease. Capital lease rentals paid by the Train Operating Companies (“TOCs”) are not dependent on passenger numbers or demand and are paid on a “hell or high water” basis. The rentals are supported by S30 of the UK Railways Act, allowing the UK Government to step-in to replace or support the TOCs, further reducing counterparty exposure of the revenues.
Sector
TransportFund
Dalmore Capital Fund 4, Co-InvestmentsFirst Investment date
November 2021Shareholding
20.0%
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Investment strategy
How we invest
For the past 14 years Dalmore has focused on investing in infrastructure that provides services critical to the functioning of society.
Through disciplined selection Dalmore funds have invested in lower volatility assets without significant exposure to GDP, traffic, usage or market price risk. Geographically Dalmore’s focus remains the UK, although we also manage assets in Europe and North America.
Looking forward, the UK mid-market core and core-plus segment continues to be our main focus, which we believe offers opportunities where disciplined underwriting, a thorough analysis of market exposure and local market expertise may support attractive risk-adjusted returns.