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Osborne delighted with price

Eurostar stake sold for higher price than expected

EurostarThe Treasury has sold its 40% stake in the Eurostar rail operator for a higher than expected £585 million. The buyer is the Canadian public pension fund Caisse de Depot du Placement du Quebec (CDPQ) and the British asset manager Hermes. They will operate under the name Patina Rail.

A plan to sell the business was set out in 2013 and it was booked in the public accounts with a value £325m. Chancellor George Osborne was clearly delighted to have secured a higher price.

“This is a very good deal – it means we can cut the national debt, it means we can invest in our national infrastructure and it’s fantastic value for British taxpayers. It’s all part of our long-term plan to secure Britain’s future,” he said.

It is thought the higher price was achieved as a result of an increasing enthusiasm among institutions to buy into infrastructure projects at a time of low interest rates which offer poor returns on other asset classes.

Selling Eurostar is part of a programme of disposals planned by the coalition government and more are expected ahead of the General Election.

There was some criticism from opponents of the sale who said the cross Channel link was a strategic asset that should remain in public hands. The remaining shares are held by by publicly-owned French rail operator SNCF, which has a 55% stake, and Belgian national rail operator SNCB, which holds 5%.

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