OpenGate's Merak Carve-Out Signals Big Bet on Sustainable Rail Tech

NEW YORK, NY & PARIS, FRANCE – July 29, 2026

In a move that underscores a powerful convergence of private equity strategy and global infrastructure trends, OpenGate Capital has announced its definitive agreement to acquire Merak, the global rail HVAC business, from German industrial giant Knorr-Bremse. While the financial terms remain undisclosed, the transaction is a quintessential example of a complex corporate carve-out, a specialty that has become the hallmark of the transatlantic private equity firm. More importantly, it represents a significant bet on the enduring growth of sustainable rail transportation and the critical component suppliers that form its backbone.

For Knorr-Bremse, the divestiture is a strategic sharpening of its portfolio. For Merak, it is a new beginning as a standalone entity poised for focused growth. But for the wider market, this deal offers a clear signal: the specialized, often overlooked industrial assets fueling the green transition are becoming prime targets for sophisticated investors seeking to build lasting value.

A Playbook for Industrial Transformation

OpenGate Capital's acquisition of Merak is far from an opportunistic purchase; it is the deliberate execution of a well-honed playbook. The firm, with dual headquarters in New York and Paris, has built its reputation on acquiring non-core divisions from large corporations and transforming them into agile, high-performing businesses. With over 40 platform acquisitions since 2005, the vast majority of which were corporate carve-outs, OpenGate has demonstrated a unique capacity for navigating the operational complexities of separating and scaling these businesses.

"Merak is a high quality business with a market leading position, differentiated technology and a global customer base built over decades," said Joshua Adams, Partner at OpenGate Capital, in the official announcement. His confidence is rooted in the firm's track record. Consider the case of SMAC, a French waterproofing firm carved out from Colas Group. Under OpenGate's ownership, the business reportedly went from breakeven to generating significant EBITDA through operational improvements before its successful sale. Similarly, the transformation of Fiven, a silicon carbide producer acquired from Saint-Gobain, involved launching new products and optimizing operations, culminating in a profitable exit.

This is the future OpenGate envisions for Merak. The strategy typically involves installing standalone IT systems, strengthening management teams, optimizing commercial strategies, and injecting capital for growth. OpenGate’s proprietary OGx® platform, a suite of digital transformation and operational excellence tools, will likely be deployed to streamline Merak’s global operations and unlock efficiencies that were difficult to realize within the larger Knorr-Bremse structure. This hands-on, operational approach is what separates such strategic private equity plays from purely financial engineering.

Unlocking Merak: From Corporate Division to Focused Leader

Headquartered in Getafe, Spain, Merak is a formidable player in its niche. With over 60 years of engineering expertise, it is a leading global provider of heating, ventilation, and air conditioning (HVAC) systems for all types of rail vehicles. Its business spans original equipment for new rolling stock, aftermarket services, and modernization projects for a vast installed base. With projected revenues of approximately €360 million for fiscal 2026, Merak is a substantial business with a global footprint across Europe, North America, China, Australia, and India.

So why would Knorr-Bremse sell such an asset? The answer lies in corporate strategy. The divestment is a key part of Knorr-Bremse's "BOOST strategy program," designed to concentrate the group on its core technological competencies and highest-margin activities. While Merak is a solid business, its HVAC systems fall outside Knorr-Bremse's primary focus on safety-critical systems like brakes and doors. By divesting Merak, Knorr-Bremse expects a positive impact on the operating EBIT margin of its Rail division, allowing it to redeploy capital and management attention to its core strengths.

For Merak, this transition to a standalone company under OpenGate's ownership is a strategic liberation. As a non-core division, it may have competed for resources and attention within a sprawling industrial conglomerate. Now, it will be the central focus of its new owners. This independence is expected to foster greater agility, enabling quicker decision-making and a more direct response to the evolving needs of its customers—the world’s leading rolling stock manufacturers. The fresh injection of capital and operational expertise from OpenGate is intended to accelerate innovation in energy-efficient technologies and expand Merak’s already impressive global reach.

Riding the Rails of a Greener Future

The strategic rationale for this acquisition extends far beyond the two companies involved. It taps directly into one of the most powerful secular growth trends of the 21st century: the global shift toward sustainable infrastructure. As nations and corporations grapple with climate change and urbanization, rail transportation has emerged as a critical solution. It is more energy-efficient and produces significantly fewer emissions per passenger than road or air travel.

This global imperative is translating into massive government and private sector investment. High-speed rail lines are connecting major cities, urban metro systems are expanding to combat congestion, and existing rail networks are being modernized. This wave of investment creates a powerful, long-term tailwind for the entire rail supply chain. Every new train and every refurbished carriage needs a sophisticated HVAC system—not just for passenger comfort, but for energy efficiency and operational reliability.

OpenGate's acquisition of Merak is a strategic investment in the "picks and shovels" of this green transportation boom. Rather than betting on a single rail operator or manufacturer, the firm is investing in a critical technology supplier that serves the entire industry. This provides diversified exposure to the sector's growth. Merak is well-positioned to capitalize on this trend, especially with an owner committed to funding R&D for next-generation, eco-friendly HVAC systems that reduce energy consumption and use more sustainable refrigerants.

Navigating a Complex Global Transaction

The path to finalizing this deal is a marathon, not a sprint. The expected closing by the end of 2026 highlights the intricate nature of the transaction. As a global business with facilities and customers across multiple continents, the acquisition is subject to a gauntlet of regulatory approvals from competition authorities in the European Union, the United States, China, India, and Australia, among others.

Each jurisdiction will conduct its own review to ensure the deal does not harm market competition. This process requires a coordinated and expert legal strategy, which is why OpenGate has retained McDermott Will & Schulte, a law firm with deep experience in complex, cross-border M&A. Alongside M&A advisors Macquarie Capital, this team is tasked with steering the transaction through the complex web of international regulations.

This extended timeline and regulatory scrutiny are part and parcel of the high-stakes industrial carve-outs that OpenGate specializes in. Successfully navigating these challenges to separate Merak and its approximately 1,500 employees into a thriving independent entity will be the first major test of the firm's value-creation strategy. If successful, Merak will emerge as a more focused, dynamic, and powerful force in the global rail industry, ready to engineer the climate systems for the next generation of sustainable transport.