Green Loan for MFD Rail: KfW IPEX-Bank financing investments in new freight cars

KfW IPEX-Bank is the mandated lead arranger, underwriter and bookrunner of large-volume growth financing for the Swiss freight car rental company MFD Rail. The funds will be used to finance up to 6,500 new intermodal railcars, which the company specialises in leasing as a European platform.

The use of intermodal freight cars makes it possible to link different modes of transport to rail transport, making the flow of goods more economical and, above all, more environmentally friendly.

MFD Rail is 98% owned by funds managed by Oaktree Capital Management, a global US investment firm, and 2% by its managing partners. For financing totalling EUR 400 million, ABN AMRO Bank N.V., Crédit Agricole Corporate & Investment Bank, ING Bank (a branch of ING-Diba AG), La Banque Postale and Siemens Bank GmbH were gained as further banking partners and are participating in the financing by syndication with more than EUR 300 million. The loan agreement is structured as a Green Loan issued by KfW IPEX-Bank and certified accordingly. Together with the previous financing of EUR 100 million from 2020, the total volume financed now stands at EUR 500 million.

“Together with our partners, we are supporting the shift of freight transport to rail and the transition to a climate-friendly transport infrastructure,” said Andreas Ufer, Member of the Management Board of KfW IPEX-Bank. “We have been supporting MFD Rail from the very beginning and are delighted that we can also play a leading role in this large-volume financing. This flagship project underscores our commitment to arranging large and complex financing structures in the European rail market. We are particularly pleased to have structured the financing as a ‘Green Loan made by KfW IPEX-Bank’”.

Markus Basler, Managing Partner & CFO of MFD Rail said, “We are very proud to have taken the next very important step for MFD Rail with this transaction to become one of the leading companies for the leasing of intermodal freight cars in Europe. By signing the new Green Loan financing, we are supporting and securing part of MFD Rail’s growth strategy of over 10,000 new intermodal freight cars over the next few years. Thanks to their positive impact on reducing carbon emissions, we are supporting the transformation of the economy and transport on the way to net zero and offering our customers added value through our sustainable service as fleet manager of a modern and highly efficient intermodal freight car fleet.”

Hermann T. Dambach, Managing Director of Oaktree GmbH, said, “We are very pleased with the success that MFD Rail has achieved in the market so far. With the support of our long-term partner banks, we can secure the continued growth of this important ESG-centric investment. At the same time, we are making good progress with regard to digitalisation; our freight cars are also prepared for the upcoming strategic changeover to automatic coupling”.

About KfW IPEX-Bank
Within KfW Group, KfW IPEX-Bank is responsible for project and export finance. It supports German and European companies operating in key industrial sectors in global markets by structuring medium and long-term financing for their exports, funding infrastructure investments, securing a raw materials supply and by financing environmental and climate protection projects worldwide. As a specialist bank, KfW IPEX-Bank has extensive industry, structuring and country expertise, it takes on leading roles in financing consortia and actively involves other banks, institutional investors and insurance firms. KfW IPEX-Bank operates as a legally independent group subsidiary and is represented in the most important economic and financial centres across the globe.

About MFD Rail
The MFD Rail Group, based in Rotkreuz, Switzerland, is a provider in the leasing and management of freight cars for European rail transport. As a team of experienced intermodal specialists, it leases out a modern and highly available fleet of new, high-quality and noise-reduced intermodal railcars for combined transport. It is considered one of the best-capitalised and most sustainable scale-ups in the industry with the goal of becoming a leading lessor in the intermodal segment.

As a provider established throughout Europe and a preferred alternative on the lease market, MFD Rail reduces dependencies on today’s service providers and diversifies its customers’ fleets. Partner-based solutions bring transparency and flexibility to leasing and maintenance concepts. Comprehensive digital operating data, transparency in leasing costs, no hidden margins and flexibility options are building blocks for customer-focused services. With its standardised fleet, automated processes and highly scalable organisation, it achieves competitive prices.

MFD Rail actively supports the modal shift from road to rail. It considers its contribution to reducing greenhouse gases and to the transition to carbon-free transport to be the focus of its environmental commitment. Certified by Sustainalytics, it is also committed to managing its growth in an environmentally-conscious, energy-efficient and climate-neutral manner and financing it via green loans.

About Oaktree
Oaktree Capital Management, L.P. (OCM) is a globally active US investment firm with headquarters in Los Angeles and further branches in the USA, Asia and Europe. Oaktree currently manages assets of USD 166 billion (as of December 2021).