InfraRed Capital Partners has agreed to acquire Hector Rail from Ancala in a deal that values the largest private rail freight operator in Scandinavia at an enterprise value of SEK2.61bn (€229.6m).
Ancala, which bought Hector Rail in 2020, said that it has since deployed follow-on capital into the operator’s locomotive fleet, strengthened the executive team, and integrated its Scandinavian and German platforms to streamline operational efficiency.
Hector Rail operates a fleet of approximately 100 predominantly electric locomotives across Sweden, Norway and Denmark, delivering timber and pulp, intermodal freight and energy transport services.
The business also maintains operations in Germany, and is one of the few freight operators running cross-border services between Sweden and Germany.
Sean Watson, partner at InfraRed, said: “Hector Rail has the attributes that we look for: a well-established, robust business with solid infrastructure credentials. Importantly, there are also extensive opportunities for growth, building on its strong position in Scandinavia and its critical role in customers’ supply chains.
“We are excited to be working with its exceptional management team and, having built and grown multiple infrastructure assets and businesses in the rail sector, we will draw on that experience to help Hector Rail achieve its potential.”
Ankur Ajmera, partner, Ancala, said: “Hector Rail demonstrates the success of Ancala’s conservative underwriting and active asset management approach. We acquired the business during a period of exceptional uncertainty for the transport sector on the basis of our analysis of Hector Rail’s infrastructure fundamentals.
“This supported our confidence in the resilience and long-term importance of Hector Rail’s business. Since then, we have worked proactively with management to create a more flexible and efficient organisation that is trusted to deliver critical freight services to its growing base of long-term customers.”
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