Infracapital, Deutsche AM get on board UK rolling stock with £700m deal

It’s full-steam ahead for their first investment together as the pair agree to buy 413 trains to operate on the new West Midlands Trains franchise.

Infracapital and Deutsche Asset Management teamed up to buy £700 million ($933.8 million; €793.1 million) of rolling stock across railways in the UK.

The duo bought the fleet of 413 new vehicles via their newly created Corelink Rail Infrastructure platform and it will operate on the UK’s new West Midlands Trains franchise. The portfolio comprises 225 new electric vehicles for services in London, 108 electric trains for Birmingham’s Cross City Lines and a further 80 diesel trains also for Birmingham.

The deal is the first time Infracapital and Deutsche AM have agreed an investment together, although the pair are thought to have made a joint bid for the East Anglia franchise last year – which was won by Rock Rail and SL Capital.

Infracapital made the deal through its £1.25 billion greenfield fund, which reached a close last month. The vehicle has now made seven investments and is 50 percent committed, according to Andy Matthews, head of greenfield at Infracapital.

Deutsche’s investment in the rolling stock assets is the fifth deal from its €1.8 billion Pan European Infrastructure II fund and its first in the UK. The fund is wholly invested in transport assets – its other deals were for Venice Airport, locomotive leasing business Akiem, airport ground support equipment provider TCR and harbour towage group Rimorchiatori Mediterranei.