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Triton International (TRTN +32%) will end its lengthy run as a public company after agreeing to be acquired by Brookfield Infrastructure (BIP) today in a take-private transaction valued at $13.3 bln. BIP agreed to pay $85.00 per TRTN share -- a nearly 35% premium compared to yesterday's closing price -- consisting of $68.50 in cash and $16.50 in BIPC class A exchangeable shares. Although both tickers are Brookfield Infrastructure, there is a slight difference between the two. Mainly, BIPC's structured differently for tax purposes. The transaction is expected to close sometime during 4Q23.

Unsurprisingly, TRTN is soaring toward the agreed-upon price today, while BIP and BIPC are not enjoying similar gains. Clearly, Brookfield investors are not pleased with the price the firm paid to acquire TRTN. However, at roughly 9x forward earnings, Brookfield is paying a reasonable premium to acquire TRTN, which will substantially bolster its transportation portfolio.

• TRTN is the world's largest intermodal container lessor, boasting 4.2 mln containers and chassis, representing 7.2 mln twenty-food equivalent units, or TEUs. The company's footprint is vast, spanning 46 countries, with a customer base comprised of some of the world's most prominent container shipping lines.
• Given how shipping and container utilization rates have trended since the pandemic, TRTN has enjoyed exceptional returns over the past few years, witnessing multiple quarters in a row of double-digit revenue gains yr/yr. The consistently sturdy quarterly numbers have helped send shares of TRTN over 185% higher since pandemic lows, crushing the major indices over that timeframe.
• With TRTN being taken private, not many public container leasing companies remain. One of TRTN's main rivals is Textainer (TGH), which also happens to be the world's second-largest container leasing firm measured in TEUs. TGH has also seen its shares flourish since the pandemic, boasting gains similar to TRTN over the past three years.
  • However, like TRTN, TGH is exposed to the risk of major shipping lines outright purchasing their containers instead of continually leasing. Also, the container leasing industry has been consolidating over the years, forming organizations with better access to capital and a better ability to lower rates and provide more favorable lease terms.
• Although investors can still gain exposure to the world's largest container lessor by owning shares of BIP or BIPC, they would give up the excellent 4.4% dividend yield TRTN carried. Also, although TRTN would massively bolster Brookfield's transportation segment, it still boasts several other divisions, including utilities, midstream, and data. As such, investors would not be purely invested in the shipping container space.

Lastly, it is worth noting that given the heavy consolidation within the container leasing industry and many firms being taken private over the years, TGH may be next on the list of firms to be taken private. Its shares are currently soaring on the day.