I am pleased to inform the House that the Government have approved the sale by London and Continental Railways Ltd of HS1 Ltd.

HS1 Ltd is the company that holds the concession to operate Britain’s first high-speed railway, running from central London to the channel tunnel. It also includes the stations at St Pancras International, and the international stations at Stratford, Ebbsfleet and Ashford. It is used by Eurostar and the Kent domestic high-speed services. Deutsch Bahn have also recently announced their intention, by 2013, to start running international services over the line to Frankfurt and Amsterdam, via Brussels.

The successful bidder is a consortium comprising of “Borealis Infrastructure” and “Ontario Teachers’ Pension Plan”, each with a 50% stake. The acquisition value is just under £2.1 billion. The sale receipts will be paid on completion of the contract, which is expected to happen later this month. At that point, the consortium will become the owner of HS1 Ltd which has a 30-year concession to manage the High Speed 1 line and stations. Under the terms of the concession, HS1 has the rights to sell access to track and stations on a commercial basis while having to preserve the nature and capacity of the high-speed railway and to maintain and renew it to modem standards. Compliance with these terms is overseen by the Office of Rail Regulation.

The Secretary of State for Transport will continue to own the infrastructure of the railway and the freehold to the associated land. On expiry of the concession, the Government will once more take unencumbered ownership of the railway with the opportunity to let a further concession. In addition, the Government retain a 40% stake in Eurostar International Ltd and development rights on the major associated regeneration sites at Kings Cross and Stratford.