While Allco has a long history dating back more than 20 years in arranging the leasing of industrial equipment, and especially transport equipment, the information memorandum reveals that Allco's investors and management changed the business model radically over the last three or four years.Since 1979, the mainstay of Allco's activities in the financing arena was to act as an arranger, structuring financing for transport industry clients mostly, with the company earning origination fees. Allco rarely advanced any loans or invested any equity in the equipment the group was helping to finance. That's now changed, however.The explanatory memorandum published yesterday in connection with the planned merger of Allco Finance Group and Record Investments shows that Allco now takes principal positions in rail, shipping and aircraft leasing.Allco said it entered aircraft leasing finance as a principal rather than simply an arranger in 2003. The group now has a portfolio of 28 aircraft with an approximate cost of $2 billion.Allco became a principal investor and charterer of freighters, tankers and other vessels in 2002. Through Allocean, Allco said it has a fleet of 20 vessels with an original cost of round $650 million.Also since 2002, Allco has entered into two rail leasing joint ventures, one with Macfield Leasing Corp and a second with Chicago Freight Car Leasing Co in Australia. Allco said that it is the largest freight rail operating lessor in Australia, with over 50 locomotives and 550 wagons on lease to major operators in Australia. Rail is an arena of developing interest for Allco. The company said that in early 2006, Allco acquired the rolling stock of Silverton (then trading as Silverton Rail), a portfolio consisting of a standard gauge fleet of diesel electric locomotives and wagons. Allco said it also has the right, until 23 May 2006, to complete due diligence in order to acquire a majority interest in RTSG (a locomotive contractor with facilities in Melbourne, Parkes, Adelaide and Broken Hill).Allco also said it has become a principal investor in "significant infrastructure financings", though the explanatory memorandum does not elaborate on current markets of interest or detail the scope of these investments.Allco's recent expansion of business under the banner of specialised funds management has been much more visible than its traditional activities in transport finance. The group listed related entities, included Allco HIT and Allco Max, which collectively provide senior and subordinated loans to financial transactions managed by Allco and Record.The explanatory memorandum reveals that Allco plans to split its 88 per cent holding in Allco HIT more or less equally between the new Allco, with the balance to be held by the Allco Principals Trust.