Houlihan Lokey Advises RELAM
Houlihan Lokey is pleased to announce the successful placement of a second lien term loan and delayed draw term loan for RELAM, a portfolio company of Paceline Equity Partners, LLC (Paceline). Proceeds from the transaction were used to refinance existing second lien indebtedness, fund a dividend to shareholders, and pay transaction-related fees and expenses. The transaction closed on September 25, 2024.
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 leasing 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 more than 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. Leveraging significant competitive tension and strong lender relationships, Houlihan Lokey was able to achieve outlier results with respect to both economic terms and process efficiency, including closing on an accelerated timeline. Houlihan Lokey was able to exceed the sponsor’s objectives, including returning capital to investors with terms comparable to a new LBO financing, refinancing existing debt at a lower cost of capital, and adding a portability feature. This is the second successful financing that Houlihan Lokey has closed for RELAM within the past 16 months.
Houlihan Lokey’s Capital Markets Group and Equipment-as-a-Service team 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 $18 billion in capital across 80 closed deals for the past 12 months ending September 2024.
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