Talgo has recently become a matter of state in Spain. The takeover bid launched by the Hungarian group Magyar Vagon raised alarms across the government. The Ministry of Transport suggested linking Russian interests through Talgo’s shareholders as a justification to block the purchase, and on Tuesday the Council of Ministers halted the sale plans of the train maker due to national security and public order concerns. Since November, the government has sought to attract other potential buyers such as CAF or Criteria Caixa, both of which found the business unattractive, while Skoda was rejected as a Talgo option. The main challenge facing the company is its limited industrial capacity. Its materials are exported and sought after across continents, but without new investments it cannot meet a growing order backlog and risks dying of success.
Founded in 1942 by engineer Alejandro Goicoechea and businessman José Luis Oriol, Talgo is today Renfe’s main supplier and plays a central role in the high-speed project for the railway line between Mecca and Medina in Saudi Arabia. The train manufacturer operates as a relatively small but influential player among industry giants such as Japan’s Hitachi, which posted substantial revenue last year, Germany’s Siemens, and China’s state-backed CRRC, which reported sizable earnings. French group Alstom, which acquired Canada’s Bombardier in 2021, is another major force in the sector. Talgo, headquartered in Las Rozas near Madrid, remains a notable player despite the dominance of multinational competitors.
The company’s footprint sits well behind its Spanish rival CAF, which specializes in trams and urban rail. CAF reported revenues of 3.825 billion euros in the previous year. Based on stock market data, CAF’s market capitalization sits around 1.169 billion euros, while Talgo trades near 488 million euros on the market.
Talgo operates two factories in Spain and employs up to 2,500 people nationwide. One plant is located in Rivabellosa (Ribera Baja, Álava), where carriages and bogies are produced, employing as many as 700 people. The other plant sits in Las Matas (Las Rozas, Madrid), where locomotive units are manufactured. The company also maintains a network of service bases across Madrid, including the Fuencarral and Santa Catalina bases for high-speed trains, and Las Matas for Talgo locomotives hauled by trailers. Across Barcelona there are the San Andrés Condal workshops for Talgo cars from series 5 and 6, and Can Tunis for high-speed trains. Maintenance teams are also stationed in La Sagra (Toledo), Valladolid, and Los Prados (Málaga).
Last year Talgo closed its strongest order year on record, signing major contracts with European operators such as Deutsche Bahn in Germany and DSB in Denmark. The company reported a turnover of 652 million euros, up 39 percent from 2022, and eightfold growth in net profits to 12.2 million euros. In the first half of the current year, net profit reached 14.6 million euros, up 108 percent from the same period in the prior year, while revenues rose to 346 million euros, a 20 percent advance. Historically, Renfe has been Talgo’s largest client, but since 1992 the company has developed a high-speed line, enabling material exports to countries including the United States, Germany, Denmark, Russia, Bosnia, Saudi Arabia, Kazakhstan, and Uzbekistan. European markets remain the primary target, accounting for more than 60 percent of the portfolio.
From an operational standpoint, the high-speed Avril train, Talgo’s flagship product, exposed weaknesses this summer amid several malfunctions. The schedule for a 4.014 billion euro order book has proven difficult to execute with the current production capacity. Analysts at Bankinter noted the fall of the Magyar Vagon takeover bid and a low likelihood of counter-offers, and highlighted the lack of options to improve the group’s financial and operational situation after the failed bid.
Talgo faces reputational damage due to delays in delivering high-speed trains of exceptional speed, including the Avril project with trains capable of 330 kilometers per hour. Initiated in 2016, the project involved 30 trains, roughly 1.5 billion euros in value for construction and maintenance, and was intended to bring high-speed rail to Galicia and Asturias. Timelines slipped, and Renfe even contemplated imposing penalties for late deliveries.
Accionariado
Talgo’s shareholding is diverse, yet two investors – a American-based investment fund and a family-backed investment vehicle – control a significant stake, collectively exceeding 45 percent. Other participants include sovereign funds, insurers, and smaller investment vehicles. Trilantic Capital stands as the largest shareholder with a 40.03 percent stake, valued at over 236 million euros after the stock market halt. This U.S.-aligned private equity fund traces its roots to the former Lehman Brothers’ investment arm, which emerged after the bank’s collapse and was later integrated into a Luxembourg-based investment vehicle. Its association with Talgo dates back to March 2006, though in 2015 it divested part of its holdings during the company’s listing. At debut, its stake stood at 32 percent; between 2017 and 2022, its share rose from 35 percent to the current 40 percent.
The second-largest shareholder is the Torrblas family office, a Madrid-based investment vehicle led by Ana Patricia Torrente Blasco, owning 5.03 percent of Talgo, valued at about 31.7 million euros according to CNMV records. The Torrente family’s operation, with Ana Patricia controlling more than 57 percent, entered Talgo in December 2022 with a 3.04 percent stake and has since climbed to above 5 percent.
Beyond these, Talgo features a broad, dispersed shareholder base that includes smaller funds, insurers, and sovereigns, each holding under five percent. The third-largest stake belongs to the UK pension fund Universities Superannuation Scheme (USS) with 2.98 percent. Following are the American niche fund SCWF with 2.98 percent, the British insurer Aviva at 2.97 percent, the Spanish firm Santa Lucía at 2.92 percent, the Norwegian sovereign fund Norges Bank with 2.84 percent, Morgan Stanley at 2.41 percent, and Capital Group, a major global fund manager, at 1.82 percent.