Legal & General has provided approximately £120m (€137m) of debt for the acquisition of High Speed 1 (HS1), the fast trainline connecting London to the Channel Tunnel.
The transport infrastructure asset was sold by two Canadian pension funds in July to a consortium including Equitix, HICL and Infrared Capital Partners.
The deal was financed by LGIM Real Assets, on behalf of clients including Legal & General Retirement.
It is LGIM Real Assets’ second investment in UK rail-related infrastructure this year after it helped to finance a fleet of new Bombardier trains for the First MTR South Western Trains franchise in June.
The 68 mile HS1 line runs from the capital to Kent connecting St Pancras station with the Channel Tunnel and serves four stations including St Pancras International, Stratford International, Ebbsfleet International and Ashford International.
HS1 has a 30-year concession agreement with the UK Secretary of State to operate and manage the railway. It is the only high-speed railway in the UK at the moment, while plans are being made for High Speed 2.
HS1 opened in 2007 and OMERS Infrastructure and the Ontario Teachers Pension Plan acquired the railway line from the government in 2010.
Charles-Henry Lecointe, senior investment manager at LGIM Real Assets, said: “HS1 reinforces our continued commitment to investing in key UK infrastructure assets, which will have a major impact on stimulating economic growth while ensuring long-term cash flow for pension funds.
”As UK’s only high-speed railway, HS1 is a strategically important asset, connecting South East England with Europe and will generate stable returns for investing pension funds.”
Kerrigan Procter, Managing Director of Legal & General Retirement, said: “Legal & General has invested £12bn in UK infrastructure, direct investments and urban regeneration projects to date, and aims to invest a further £15bn.
”Our financing of this major infrastructure project is a strong investment fit for us as the long term income it produces helps to pay our customers’ pensions, as well as creating new jobs and driving economic growth – which is good for business and our customers.”