The British Government has sold its stake in cross-channel rail operator Eurostar for £757.1 million.
Last year, ministers announced plans to dispose of the UK’s shareholding in the operator as it looked to make £20 billion from the sale of corporate and financial assets by 2020.
Chief Secretary to the Treasury Danny Alexander said he believed the government had been able to achieve a “much higher price than market expectations”.
Caisse de dépôt et placement du Québec (CDPQ) and Hermes Infrastructure are to acquire the 40 per cent stake for £585.1 million. In addition to this, the government will receive £172 million from Eurostar for its preference share.
Subject to approval, the sale is expected to be completed in the second quarter of this year.
The deal could still be prevented by SNCF and SNCB, which as existing shareholders have the right to acquire the UK government’s stake for a 15 per cent premium.
Apparently this sale still has to be ratified by EU commissioners in Brussels and this may not happen before July, so there could be a problem if they disagree in any way. Nevertheless, I am pleased that the buyers are Anglo/Canadian pension funds and not SNCF, as that would have meant Eurostar becoming a mere division of the French state-owned railway and with a possible relocation of headquarters from London to Paris.
Looks like the Cameron government are predicting a shortfall in the books…