Element Fleet Management & Blackstone: A Strategic Funding Partnership

Element Fleet Management Corp. (TSX:EFN), the world's largest publicly traded pure-play automotive fleet manager, and funds managed by Blackstone Credit & Insurance, through its Infrastructure & Asset-Based Credit group, have announced a strategic funding relationship involving a CAD $500 million portfolio of Canadian fleet lease receivables. This partnership enables Element to achieve substantial off-balance sheet treatment, diversifying and optimizing its funding profile while validating the high quality of its asset origination platform and supporting the company’s continued growth.

Through this strategic arrangement, Element benefits from substantial off-balance sheet treatment, diversifying and optimizing its funding profile while validating the high quality of its asset origination platform and supporting the company’s continued growth. “Element is committed to optimizing our funding strategies to support our growth objectives,” said Heath Valkenburg, Incoming EVP & Chief Financial Officer at Element. “This strategic relationship with Blackstone enhances our ability to serve our clients and capitalize on emerging opportunities in the market.”

“We are pleased to provide Element with capital that helps them better support their client base with a valuable financing tool for companies around the globe,” said Aneek Mamik, Head of Financial Services for Asset Based Finance at Blackstone Credit & Insurance. “This transaction shows how we can support diverse sectors of the real economy through our asset-based finance efforts – where we have strong momentum and a unique platform.”

Blackstone Credit & Insurance (“BXCI”) is one of the world’s leading credit investors. Its investments span the credit markets, including private investment grade, asset-based lending, public investment grade and high yield, sustainable resources, infrastructure debt, collateralized loan obligations, direct lending, and opportunistic credit. BXCI seeks to generate attractive risk-adjusted returns for institutional and individual investors by providing companies with the capital needed to strengthen and grow their businesses.

Element Fleet Management (TSX: EFN) is the largest publicly traded pure-play automotive fleet manager in the world. As a Purpose-driven company, we provide a full range of sustainable and intelligent mobility solutions to optimize and enhance fleet performance for our clients across North America, Australia, and New Zealand. Our services address every aspect of our clients’ fleet requirements, from vehicle acquisition, maintenance, route optimization, risk management, and remarketing, to advising on decarbonization efforts, integration of electric vehicles, and managing the complexity of gradual fleet electrification. Clients benefit from Element’s expertise as one of the largest fleet solutions providers in its markets, offering economies of scale and insight used to reduce operating costs and enhance efficiency and performance.

This strategic funding relationship with Blackstone positions Element Fleet Management to further optimize its capital structure, enhance financial flexibility, and support its growth objectives. By leveraging Blackstone's capital and expertise, Element can better serve its clients and capitalize on emerging opportunities in the fleet management market.

Element Fleet Management's financial performance has been robust, with record results in 2024 driven by an 18% year-over-year increase in services revenue and a 9% year-over-year increase in net financing revenue. The company's strong performance allowed for the acceleration of strategic investments while delivering full-year adjusted operating margins within guidance range. Element's high-recurring-revenue business model, combined with the benefits of investments made in 2024, drives continued growth across key financial metrics. The company reaffirmed its 2025 guidance for net revenue growth of 6.5 to 8.5%, positive adjusted operating leverage, and high single- to low double-digit growth in each of adjusted operating income, adjusted EPS, and adjusted free cash flow per share.