Green light given for Angel Trains acquisition

Angel Trains, one of three UK rolling stock operating companies (ROSCOS), has been acquired by Australia-based AMP Capital Investors and Canadian-owned PSP Investments from previous owner Arcus European Infrastructure.

Angel Trains was established in 1994 and leases its rolling stock to all 19 of the UK’s franchised train operating companies and two open access operators. It has a modern, diverse fleet of approximately 4,500 vehicles.

AMP capital global head of infrastructure equity Boe Pahari said: “I am delighted to have secured a majority stake in Angel Trains, one of the UK’s leading train leasing specialists, on behalf of our clients. We have come to know the asset very well during our seven years of ownership and we and our investors like its long-term contracted revenue, stable cash flows and strong growth opportunities.

“This is a key transaction for AMP Capital’s Infrastructure Equity team. Angel Trains is the largest asset held by AMP Capital’s Global Infrastructure Fund, which was launched in October 2014. The fund achieved its first close earlier in the year and fundraising has contributed to AMP Capital’s global infrastructure platform already reaching half its target size of US$2 billion.”

AMP Capital’s managed funds have been invested in Angel Trains since 2008 and prior to the transaction AMP Capital held 25% of the company while PSP Investments held approximately 16%. As part of the sale by Arcus European Infrastructure Fund, PSP Investments has separately acquired an additional stake and is increasing its ownership to 30%.

Together with Porterbrook and Eversholt, Angel Trains represents the backbone of the UK’s rolling stock. The trio was formed following the privatisation of the railways in 1994, which created three train leasing companies.

In a sign of rising demand for UK infrastructure assets, all three have been sold within the past 12 months.

Eversholt (formerly HSBC Rail) was sold to Li Ka-shing’s CK group in January while a consortium of overseas buyers acquired Porterbrook last October.

Angel Trains, which has reportedly been sold for about 9.5 times earnings, leases some of Britain’s best known trains, including the class 390 Pendolino train used by Virgin Trains on the West Coast Mainline.

The group was owned by RBS until 2008 when Arcus’ predecessor Babcock & Brown led a consortium of investors to take over the leasing company.