Daily News: December 12, 2013

Element Financial Provides Trinity Up to $2B Lease Financing

Element Financial announced it entered into a strategic alliance with Trinity Industries to provide lease financing for up to $2 billion worth of railcars over the next two years. Element also announced that it signed a definitive agreement with a subsidiary of GE Capital in the U.S. to purchase a portfolio of finance assets secured by helicopters for a purchase price of approximately $245 million.

These two transaction are expected to be accretive to Element’s shareholders commencing in the second half of 2014 while decreasing OPEX, increasing leverage and maintaining established risk parameters.

“With these two transactions, Element has firmly anchored itself as a North American leader in two of our five core equipment finance verticals — aviation finance and railcar finance,” noted Steven K. Hudson, Element’s chairman and CEO. “Working alongside the leading manufacturers that we support in these verticals, we expect to originate growing volumes of diversified high-quality finance assets over the next several quarters as a result of these initiatives.”

Concurrent with the transactions, Element announced that it plans to sell, on a “bought deal” basis pursuant to a supplement to the company’s final base shelf prospectus dated December 6, 2013, an aggregate of 23,637,000 common shares of Element at a price of $13.75 per common share for gross proceeds of approximately $325 million to a syndicate of underwriters co-led by GMP Securities, BMO Capital Markets, Barclays Capital Canada, CIBC World Markets and RBC Capital Markets and including Credit Suisse Securities (Canada), National Bank Financial, TD Securities and Cormack Securities.