On Thursday, Dallas-based Trinity Industries Inc. announced that it has completed the spin off of its infrastructure-related business, including the inland barge group, into a public company, Arcosa Inc. Trinity will continue to operate its integrated rail manufacturing, leasing, and services businesses. Trinity describes Arcosa as a growth-oriented manufacturer of infrastructure-related products and services with leading positions in construction, energy, and transportation markets.
An overbuilding of barges, both hopper and liquid, over the past few years sent the barge building industry into a tailspin that resulted in several shipyard closures and the loss of hundreds of jobs.
Jeffboat Inc., Jeffersonville, Ind., closed its doors earlier this year. In addition, its main competitor, Trinity Industries' inland barge group, closed two of its shipyards in 2015 and 2016 when orders for new bottoms dried up. Trinity Marine Products was the company's inland barge group and is one of the U.S.'s largest builders of tank and hopper barges.
At the end of 2008, Trinity reported a barge order backlog of $527.8 million. It hit a high of $564.1 million in 2012, but fell to only $98.2 million by the end of 2017, regulatory filings show. For the first quarter, the backlog was $124.5 million with liquid inquiries “encouraging,” company officials told analysts.
Trinity shut down its Madisonville, La., yard, which had 336 workers, in 2015, and Brusly, La., with its 288 workers, in 2016. However, due to encouraging conditions in the barge construction market, Trinity Marine Products was preparing to re-open the Madisonville facility as barge orders develop to produce a variety of barge types for customer delivery in 2019, Trinity spokesman Jack Todd said recently.
Arcosa began trading Nov. 1 on the New York Stock Exchange under the ticker symbol “ACA” at the market open. As a result of the spin-off, Trinity’s focus will center on its integrated rail manufacturing, leasing, and services businesses while continuing to operate its highway products and logistics businesses.
“Today marks an exciting day for the future of Trinity Industries and our history of evolutionary growth,” Timothy R. Wallace, Trinity’s chairman, CEO and president, said in a prepared statement. “I look forward to focusing our attention and resources on growth initiatives in the North American railcar industry while optimizing our capital structure to support our operational and financial objectives."
