Acquisitions · Container leasing
Mitsubishi HC Capital buys container lessor CAI for $2.9 billion
- Buyer
- Mitsubishi HC Capital (Tokyo)
- Target
- CAI International, San Francisco, California
- Value
- About $1.1B equity ($2.9B including debt)
- Status
- Completed in November 2021.
- Date
- 2021-06-17
Mitsubishi HC Capital agreed to buy CAI International, a New York Stock Exchange-listed company that leases shipping containers, for $56 per share in cash. That was a 46.8% premium to CAI's share price and valued its shares at about $1.1 billion, or about $2.9 billion including debt.
Why it matters
Made Mitsubishi HC Capital, formed by a merger in April 2021, one of the world's largest container lessors just as shipping demand was booming during the pandemic.
The deal
Mitsubishi HC Capital agreed on June 17, 2021 to buy all common shares of CAI International for $56.00 each in cash, a 46.8% premium to CAI's closing price the day before. The equity was worth about $1.1 billion, and the enterprise value, which adds CAI's debt, was about $2.9 billion. CAI's preferred shares stayed outstanding. The deal needed CAI shareholder and regulatory approvals and closed in November 2021.
About CAI
CAI International, based in San Francisco, owned and leased shipping containers to ocean carriers around the world. Before the deal it had sold its railcar and logistics businesses to focus on containers. Container demand and lease rates had jumped in 2020 and 2021 as shipping lines struggled with pandemic disruption and port congestion.
Why Mitsubishi HC Capital did it
Mitsubishi HC Capital was created in April 2021 by merging Mitsubishi UFJ Lease & Finance and Hitachi Capital. It already owned Beacon Intermodal Leasing, a US container lessor. Adding CAI made it one of the largest container lessors in the world, with stable long-term lease income in dollars.
What happened next
After closing, CAI was combined with Beacon under Mitsubishi HC Capital's US operations. Container lease rates fell back after 2022 as shipping returned to normal, which tested the price paid at the peak.
Sources
Kakehashi M&A News home
