A group of U.K. pension funds and Canadian pension fund manager Caisse de Depot et Placement du Quebec, Montreal, will acquire a total 40% share in Eurostar International, the high-speed rail link between London and Paris, and London and Brussels.
Caisse agreed to acquire 30% of Eurostar from the U.K. government, while Hermes Infrastructure intends to own 10% on behalf of a group of U.K. corporate and local authority pension funds, including the £10 billion ($15.3 billion) Santander (U.K.) Common Investment Fund, Manchester, England.
“We're an investor in the (Hermes) fund but have also supported the bid via our segregated account program, such that we are now holding just over 4% of the company,” said Antony Barker, director of pensions at Santander U.K., in an e-mail. He described the transaction as a “good deal” given the extension of the franchise across France.
Mr. Barker added that pension fund executives agreed to reduce the fund's equity allocation in favor of real assets, “which we have been securing around the globe.”
A spokesman for the C$225.9 billion (US$184.6 billion) Caisse said its global infrastructure investment portfolio was valued at more than C$10 billion as of Dec. 31.
“This is another opportunity for us to further build on our expertise in the transport sector, while broadening our footprint in the global marketplace,” said Macky Tall, senior vice president, private equity and infrastructure, at Caisse, in a news release.
The consortium owns stakes alongside French state rail company SNCF, and Belgian state rail firm SNCB.
The deal is conditional upon clearance from the European Commission and is expected to close in the second quarter.