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LCR offers £295M for Section 1 of Channel Tunnel Rail Link

LONDON & CONTINENTAL Railways (LCR) has offered Railtrack £295M for the concession for Section 1 of the Channel Tunnel Rail Link (CTRL).

If successful, the deal will see LCR regain control of the concession for all CTRL infrastructure.

LCR, as construction client for the whole project, already holds the concession for Section 2, which runs from north Kent to London St Pancras.

But it gave Railtrack the option to buy Section 1 between the Channel Tunnel and Ebbsfleet when the project ran into financial trouble in 1998.

As concession holder for 80% complete Section 1, LCR would have the right to collect all track access charges from train operators using the completed line.

Railtrack had originally agreed to raise £1.7bn to fund Section 1 through a combination of bonds and banks loans. This became impossible once the track operator went into administration.

LCR is paying Railtrack £295M to compensate it for the profits it would have made from the concession. It was originally to have used proceeds from selling Section 1 to fund construction of Section 2 (NCE 18 October 2001).

But LCR head of public affairs Bernard Gambrill said ownership of the completed asset plus the revenue stream from track access charges would allow LCR to borrow extra money instead.

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