A consortium of Canadian pension funds, including the Ontario Teachers’ Pension Plan and Ontario Municipal Employees Retirement System, will pay $2.1 billion pounds ($3.4 billion) to operate Britain’s only high-speed railway, Reuters reported. The deal – by which the consortium will operate the line, called High Speed 1, for 30 years – represents Britain’s recent efforts to cut the national debt, Reuters said. The High Speed 1 route links St Pancras station in north London to the Channel Tunnel, and became fully operational in November 2007.
(Reuters) – A consortium of Canadian pension funds have succeeded in their 2.1 billion pound bid to operate Britain’s only high-speed railway, the first privatisation of a government intent on cutting the national deficit.
Ontario Teachers’ Pension Plan (OTPP) and Borealis, which is the infrastructure investment arm of Ontario Municipal Employees Retirement System, will pay 2.1 billion pounds to operate the line, dubbed High Speed 1 (HS1), for the next 30 years.
“It is an enormous amount of money and is a big vote of confidence in UK plc and a big vote of market confidence in the future of UK high-speed rail,” British Transport Secretary Philip Hammond said in a statement.
“It also shows that the decisive action this government has taken to reduce the deficit is already paying dividends and that investors believe once again that Britain is open for business,” he said.
The coalition has vowed to reduce Britain’s debt pile and slash a budget deficit that will reach about 150 billion pounds this year.
The entire line of HS1, whose 35-minute route links St Pancras station in north London to the Channel Tunnel, became fully operational only in November 2007. The whole project cost about 5.8 billion pounds to build.
The line stands to benefit from the liberalisation of the European cross-border rail passenger market, with Deutsche Bahn planning to compete with Eurostar and run services between London and continental European cities by the end of 2013. (Reporting by Rhys Jones and Greg Roumeliotis; Editing by Will Waterman)