AMP Capital, a unit of Australia’s largest pension fund, is nearing an agreement to buy control of Angel Trains in a deal that would value the U.K. rolling stock lessor at about $5 billion, people familiar with the matter said.
AMP, which already owns 25 percent of Angel Trains and has pre-emptive rights to increase that stake, may announce the purchase as early as next week, said the people, who asked not to be identified because the talks are private. Angel Trains owns more than 4,600 vehicles with a combined value of 3 billion pounds ($4.8 billion), including the high-speed Pendolino tilting trains run by Virgin Trains.
Other than AMP, current shareholders include Arcus Infrastructure Partners and pension investors. London-based Arcus is selling its stake of about 42 percent in the leasing business, two of the people said.
The Australian pension fund unit is leading a consortium that includes sovereign wealth fund Abu Dhabi Investment Authority, Swiss Life Holding AG, PensionDanmark AS and a large Asian sovereign fund, AMP said today in a statement. The Asian fund is SAFE Investment Co., the investment arm of China’s foreign-exchange regulator, one of the people said.
AMP Capital knows the asset, has completed due diligence and has a preferred position to buy it due to its pre-emptive rights, the company said in the statement. “AMP Capital’s valuation work and business case has been agreed and finalized and it is ready to acquire Angel under the right of first offer that AMP Capital has.”
A sale of Angel would make it the third rolling stock business to be sold in the U.K. in recent months as investors seeking stable returns acquire such assets. Hong Kong billionaire Li Ka-shing agreed in January to buy Eversholt Rail for an enterprise value of 2.5 billion pounds ($4 billion).
The AMP consortium is being advised by the investment banking arm of Macquarie Group Ltd., PricewaterhouseCoopers LLP, CMS Cameron McKenna and SDG, it said in the statement.
A spokesman for ADIA declined to comment and PensionDanmark and Swiss Life couldn’t immediately comment. Arcus couldn’t be immediately reached for comment. Calls to phone numbers registered to SAFE Investment in Hong Kong weren’t answered, while a Beijing-based press officer at China’s State Administration of Foreign Exchange said she couldn’t immediately comment.