Tuesday, 9 September 2014

Severn Trent bidders come together again...

But don't get too excited - it's not with a view to buying Severn Trent for £5 billion. Well, not at the moment, at least.

My sources tell me Canada's Borealis has been working with Wren House Infrastructure Management - a specialist infrastructure investment group set up by the Kuwait Investment Authority last year - to join a consortium bidding for train leasing company Porterbrook.

For readers that don't recall, Poterbrook - which owns one third of Britain's trains - has been put up for sale for £2 billion by a consortium of investors led by Deutsche Bank.

Australian investment house Macquarie is leading the group currently comprising Borealis and Wren House that is interested in buying Poterbrook.

The other main consortium vying for Poterbrook is being led by Hastings, another Aussie infrastructure investor. Canada's Aimco and Germany's Allianz are part of that consortium, as reported by The Sunday Times a couple of weeks ago. Here is a link to The Sunday Times piece:


The two Australian-led consortiums will be up against some stiff competition in the form of Cheung Kong Infrastructure Holdings, which is controlled by Asian billionaire Li-Ka Shing, and has been gobbling up British infrastructure assets, such as Northumbrian Water, over the last five years.

Back in July, I picked up on rumours that Sumitomo Mitsui Banking Corporation was looking at buying Porterbrook. However, I am not aware that they have joined a consortium, so it remains to be seen whether SMBC will follow through on its original interest in Poterbrook. Most of my sources tell me the Japanese bank is not participating in the Porterbrook auction anymore.

Macquarie declined to comment. Wren House and Borealis did not return calls for comment.

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