Greenbrier exits wheelset roller bearing reconditioning business

       Greenbrier exits wheelset roller bearing reconditioning business

Long-term supply agreement ensures cost-competitive supply of wheelset roller
bearings; Sale furthers strategy to reduce non-core assets to enhance earnings
and capital return

PR Newswire

LAKE OSWEGO, Ore., Feb. 28, 2013

LAKE OSWEGO, Ore., Feb. 28, 2013 /PRNewswire/ --The Greenbrier Companies,
Inc. [NYSE:GBX] announced today it has entered an asset purchase agreement
with The Timken Company [NYSE:TKR] for sale of substantially all the equipment
utilized in Greenbrier's reconditioned wheelset roller bearing operations in
Elizabethtown, Kentucky ("Elizabethtown"). Concurrent with the sale,
Greenbrier will enter into a long-term supply agreement with Timken for
reconditioned and new bearings. The companies did not disclose the asset
purchase price. Closing of the transaction is expected before the conclusion
of Greenbrier's fiscal third quarter ending May 31, 2013.

Greenbrier acquired Elizabethtown in 2008 to provide reconditioned wheel
bearings for use in Greenbrier's Wheel Services, Refurbishment & Parts
segment. Elizabethtown has employed an average of 100 people during
Greenbrier's last two fiscal years and is Greenbrier's only wheelset roller
bearing reconditioning facility. The operation is profitable. However,
recent changes in rules related to reconditioned components and a constrained
availability of certain key materials has diminished the strategic value of
this operation rendering it a non-core asset to Greenbrier. As a global
bearing manufacturer with four rail bearing reconditioning facilities in the
US, Timken brings scale and experience to the supply agreement. This ensures
Greenbrier a steady, long-term supply of new and reconditioned bearings, while
eliminating Greenbrier's costs of maintaining an internal operation to meet
its supply needs.

The effects of eliminating internal production of bearings and entering into
the supply agreement are expected to be accretive to Greenbrier's earnings and
liberate approximately $10 million in capital. It is consistent with
Greenbrier's corporate strategy to reduce non-core or underperforming capital
assets and improve capital efficiency, while also increasing capital available
for reinvestment opportunities that enhance the performance of Greenbrier's
integrated business model. These efforts are designed to increase
Greenbrier's return on invested capital, improve gross margins and enhance
value to shareholders. This strategy will be described in greater detail when
Greenbrier announces its financial results in early April for its second
fiscal quarter ending on February 28, 2013.

"With the completion of this transaction, we are well positioned to focus on
our core strengths of heavy railcar repair, refurbishment, complete wheel
services and routine railcar maintenance and pursue the growth opportunities
that these areas offer," said Timothy A. Stuckey, president of Greenbrier Rail
Services. "We are pleased to partner with Timken to ensure that our
requirements for new and reconditioned wheelset roller bearings will continue
without interruption."

"Like Greenbrier, Timken is committed to improving the productivity, safety
and efficiency of our rail customers," said Brian Ruel, vice president of
off-highway, light vehicle systems and rail for Timken. "This agreement aligns
with our strategy to grow our services portfolio and invest in the rail
business." 

To complete the asset purchase transaction, Greenbrier and Timken will
complete a transition plan over the course of Greenbrier's fiscal third
quarter. This will include preparing equipment and remaining inventory for
transfer to Timken facilities. The land and buildings owned by Greenbrier at
Elizabethtown are not included in the asset purchase agreement and will be
listed for sale by Greenbrier after completion of the transition plan.

"SAFE HARBOR" STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF
1995: This release may contain forward-looking statements, including
statements regarding expected new railcar production volumes and schedules,
expected customer demand for the Company's products and services, plans to
increase manufacturing capacity, new railcar delivery volumes and schedules,
growth in demand for the Company's railcar services and parts business, and
the Company's future financial performance. Greenbrier uses words such as
"anticipates," "believes," "forecast," "potential," "contemplates,"
"expects," "intends," "plans," "seeks," "estimates," "could," "would," "will,"
"may," "can," and similar expressions to identify forward-looking statements.
These forward-looking statements are not guarantees of future performance and
are subject to certain risks and uncertainties that could cause actual results
to differ materially from in the results contemplated by the forward-looking
statements. Factors that might cause such a difference include, but are not
limited to, reported backlog is not indicative of our financial results;
turmoil in the credit markets and financial services industry; high levels of
indebtedness and compliance with the terms of our indebtedness; write-downs of
goodwill, intangibles and other assets in future periods; sufficient
availability of borrowing capacity; fluctuations in demand for newly
manufactured railcars or failure to obtain orders as anticipated in developing
forecasts; loss of one or more significant customers; customer payment
defaults or related issues; actual future costs and the availability of
materials and a trained workforce; failure to design or manufacture new
products or technologies or to achieve certification or market acceptance of
new products or technologies; steel or specialty component price fluctuations
and availability and scrap surcharges; changes in product mix and the mix
between segments; labor disputes, energy shortages or operating difficulties
that might disrupt manufacturing operations or the flow of cargo; production
difficulties and product delivery delays as a result of, among other matters,
changing technologies, production of new railcar types, or non-performance of
subcontractors or suppliers; ability to obtain suitable contracts for the sale
of leased equipment and risks related to car hire and residual values;
difficulties associated with governmental regulation, including environmental
liabilities; integration of current or future acquisitions; succession
planning; all as may be discussed in more detail under the headings "Risk
Factors" and "Forward Looking Statements" in our Annual Report on Form 10-K
for the fiscal year ended August 31, 2012, and our other reports on file with
the Securities and Exchange Commission. Readers are cautioned not to place
undue reliance on these forward-looking statements, which reflect management's
opinions only as of the date hereof. Except as otherwise required by law, we
do not assume any obligation to update any forward-looking statements.

Greenbrier, (www.gbrx.com), headquartered in Lake Oswego, Oregon, is a leading
supplier of transportation equipment and services to the railroad industry.
Greenbrier builds new railroad freight cars in its four manufacturing
facilities in the U.S. and Mexico and marine barges at its U.S. facility. It
also repairs and refurbishes freight cars and provides wheels and railcar
parts at 39 locations across North America. Greenbrier builds new railroad
freight cars and refurbishes freight cars for the European market through both
its operations in Poland and various subcontractor facilities throughout
Europe. Greenbrier owns approximately 11,000 railcars, and performs management
services for approximately 219,000 railcars.

The Timken Company (NYSE: TKR; www.timken.com), a global industrial technology
leader, applies its deep knowledge of materials, friction management and power
transmission to improve the reliability and efficiency of industrial machinery
and equipment all around the world. The company engineers, manufactures and
markets mechanical components and high-performance steel. Timken® bearings,
engineered steel bars and tubes—as well as transmissions, gearboxes, chain,
related products and services—support diversified markets worldwide. With
sales of $5.0 billion in 2012 and approximately 20,000 people operating from
30 countries, Timken makes the world more productive and keeps industry in
motion.

SOURCE The Greenbrier Companies, Inc. (GBX)

Website: http://www.gbrx.com
Contact: Mark Rittenbaum, Investor Relations, Jack Isselmann, Public
Relations, +1-503-684-7000
 
Press spacebar to pause and continue. Press esc to stop.