Railcar manufacturer Trinity Industries, Inc. looks to broaden its product line and international reach with a $61 million purchase of Quixote Corp. Chicago-based Quixote develops and manufactures highway safety products.
Trinity said it would pay for the deal with cash on hand. The acquisition, announced last week, is expected to close during the first quarter of 2010. Post-acquisition, Quixote will be combined with Trinity's Construction Products businesses.
"We are pleased to announce the agreement to acquire Quixote and look forward to integrating its businesses into our multi-industry portfolio," said Timothy R. Wallace, Trinity's chairman, CEO and president. "We have admired Quixote's line of innovative products and global reach. This acquisition will further expand our international market penetration in the highway products business through Quixote's existing customer relationships."
"This transaction will benefit both companies' customers as the combination of our product lines will provide a more robust offering of highway safety products from a single source," said Bruce Reimer, Quixote's CEO and president.
Dallas-based Trinity is a major player in the railcar market but also has inland barge, energy and construction products businesses. Trinity reports its financial results in five principal business segments: the Rail Group, the Railcar Leasing and Management Services Group, the Inland Barge Group, the Construction Products Group, and the Energy Equipment Group.
Like other major railcar manufacturers, Trinity has been hurt by the dramatic drop in demand for new railcars in the last 15 months. With so many railcars still in storage because of the slow economy, most analysts predict little pick up in railcar building activity until late 2010 at the earliest.