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US investors provide £314m helping hand to HS1

The Borealis, OTPP-owned project company has raised a lump of debt ahead of a possible sale of the UK’s high-speed rail line.

Borealis and the Ontario Teachers’ Pension Plan have raised £314 million ($387.7 million; €373.1 million) in a private placement days after announcing a possible sale of the HS1 concession.

The Canadian owners of the UK’s only operating high-speed rail line raised the debt from unnamed US investors with Canadian shareholders, according to Standard & Poor's. As of press time, HS1 had declined to comment.

The package comprised a £184 million note with a coupon of 2.3 percent maturing in March 2039 and a £130 million note maturing in December that year and carrying a coupon of 2.81 percent. They were assigned an A- rating by S&P, reflecting the low market risk as well as the transparent and supportive regulatory framework for the project, the agency explained.

HS1 said the proceeds of the placement – first announced in September – will be used for general corporate purposes. The two shareholders earlier this month revealed they were analysing a potential sale of the asset following several inquiries from would-be buyers, with a financial adviser to be appointed in due course. The pair spent £2.1 billion on acquiring the concession in 2010.

S&P added that the interest of the US investors shows a strong appetite for UK infrastructure despite its decision to leave the EU.