Houlihan Lokey Advises RELAM

Houlihan Lokey is pleased to announce the successful placement of a second lien term loan for Rail Equipment Leasing and Maintenance Inc. (RELAM), which was acquired by affiliates of Paceline Equity Partners, LLC (Paceline). The refinancing transaction closed on August 4, 2023.

RELAM is a well-known and respected provider of specialty rental equipment for recurring, regulatory-driven maintenance-of-way (MOW) work on railroads, serving the industry’s largest operators and contracted service providers. In July 2020, Paceline combined two existing MOW railroad equipment rental businesses to create RELAM, now one of the most important MOW rental companies in North America. In January 2023, the company bolstered its rental offering through the acquisition of Wiskerchen Rental & Leasing, a company that manufactures, services, and rents out hi-rail trucks and related equipment. The company’s rental solutions offer customers preferential access to different types of equipment with economic and operational advantages to otherwise owning or financing the equipment. RELAM occupies a unique position in the industry by providing value to equipment manufacturers, as well as railroad operators and maintenance contractors.

Based in Dallas, Paceline is an investment manager focused on value-oriented, opportunistic, and special situations across private equity, corporate debt, and real assets. Paceline currently manages more than $1 billion in assets with a senior leadership team that has over 15 years of cohesive investment experience, having previously worked together at a global private equity manager and its affiliates.

Houlihan Lokey served as the exclusive placement agent to RELAM, assisting the company in arranging, structuring, and negotiating the financing. Proceeds from the transaction were used to refinance existing second lien indebtedness and pay transaction-related fees and expenses. Through thoughtful positioning and execution, Houlihan Lokey delivered a second lien refinancing alternative at an attractive cost of capital despite challenging credit market conditions. Concurrent with the second lien refinancing, the company amended and upsized its existing ABL revolver facility, providing the company with materially more capital and flexibility to continue growing the business.

Houlihan Lokey’s Equipment-as-a-Service and Capital Markets teams worked jointly to drive strong market demand, optimize financing terms, and deliver seamless execution for RELAM on the transaction. Houlihan Lokey is one of the largest providers of private capital solutions in the world, raising approximately $26 billion in capital and advising on an additional $9 billion across 250+ transactions over the past two fiscal years.