VTG acquires freight car maker Graaff

“Through the acquisition of Graaff, we are expanding our business model by the activity of newbuilds for securing scarce production capacity to build special rail freight cars. We expect to profit from synergy effects in procurement, especially in the purchase of components and parts for which we have developed new procurement strategies,” said Dr. Heiko Fischer, CEO of VTG.

The Graaff Group has been building special freight cars at its Elze site in Lower Saxony since 1914. Its products include chemical tank cars with stainless steel tanks, and it has a production capacity of approximately 300 rail freight cars per year. The company was forced to file for insolvency in March 2008, due to difficulties in handling a large order and the tight liquidity situation.

VTG will continue Graaff’s focus on producing tank cars, particularly chemical tank cars, and 154 employees at the Elze plant will retain their jobs. The parties have agreed to keep the purchase price confidential, and the takeover is still subject to approval by the German anti-trust office.