Harsco Rail, a division of Philadelphia-based Enviri Corporation, recently entered into a definitive agreement that will release it from its engineered-to-order contract with Deutsche Bahn (DB), a German rail transportation company, for utility track vehicles.
Under the terms of the agreement, DB will release $13 million in performance bonds, the full amount supporting the project, along with approximately $49 million in cash. Harsco Rail already has repaid approximately $73 million in advances. Enviri had set aside funds from the sale of its Clean Earth division for that purpose.
“We are grateful for DB’s partnership throughout the life of the contract and pleased that they will receive the next generation of machines to support their mission,” Russell Hochman, Enviri president and CEO, said. “This contract exit removes a significant source of operational and financial uncertainty, enhances our financial flexibility, and advances our commitment to de-risking the business. Most importantly, it allows Harsco Rail to expand its focus on its core maintenance-of-way business, where we have long demonstrated expertise and competitive advantages and see the greatest opportunities to create long-term value and more predictable returns for our shareholders.”
Enviri provides environmental and operational solutions to the metal and rail industries. It has two divisions: Harsco Rail and Harsco Environmental.