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Kelso: Great Company - Too Richly Priced

Over the past few weeks, we've put out a number of articles on railcar manufacturers. Some of these companies own lease fleets and therefore a major risk they're exposed to is the upcoming legislation on oil tank cars. Whatever the shape of the regulations, due May 12, the bottom line is that lessors will need to spend money to upgrade their fleets (probably over a 5 year timeframe). All in, about 143,000 oil tank cars will need to be upgraded (or scrapped and replaced). Today we're going to talk about a company that we believe will help diversify away some of this risk because it'll benefit from these changes. Our attitude is that if one of our longs needs to spend capex, we want to capture those dollars by buying the company that will receive those dollars as…