German-based Alpha Trains has refinanced a large chunk of its existing bank facilities through raising €1.25 billion worth of debt from a mix of traditional lenders and institutional investors.
The package, which comprises €1.125 billion of senior debt and €125 million of junior liquidity, will help the rolling stock leasing business extend the average maturity and lower the cost of its overall debt load.
The senior debt is rated Baa2 by Moody’s and BBB by Fitch. It comprises a €350 million public bond maturing in 2025, listed on the Luxembourg Stock Exchange, as well as €250 million of institutional term loans expiring between 2027 and 2030 and €525 million of term bank loans with tenors of between five and seven years.
The junior debt came in the form of a seven-year loan, €80 million of which was provided by Sydney-based asset manager Whitehelm Capital. The firm invested on behalf of three clients that included Australian pensions MTAA Super and Prime Super.
Alpha Trains, continental Europe’s largest rolling stock lessor, owns a portfolio of 334 passenger trains and 369 locomotives. Formed in 2010 through a spin-off of the mainland European arm of the UK’s Angel Trains, its shareholders are London-based Arcus Infrastructure Partners (which owns 51.1 percent), Canadian pension PSP Investments (28 percent) and Australian fund manager AMP Capital (20.9 percent).
Alpha Train’s debt raise closely follows a similar move by its former parent company, which closed a £1.16 billion (€1.59 billion; $1.80 billion) refinancing last November.
Angel Trains is owned by a consortium comprising Arcus, AMP, and PSP as well as London-listed fund International Public Partnerships and Australian pensions STC Funds Nominee and Prime Super, both advised by Whitehelm Capital.
“There will be 16,000 new trains by 2043 and Angel will participate in that in terms of new concessions,” Boe Pahari, global head of infrastructure equity at AMP, recently told Infrastructure Investor. He praised the business as being in his view the best of the UK’s rolling stock businesses, being a strong performer both in terms of cash yield and returns.
In a year that saw the rolling stock sector generate a flurry of deals, AMP last May topped its previous 15 percent interest in Alpha Trains with an extra 6 percent.