Refinancing and financing of rolling stock, spares and special tools by way of operating lease.

Descriptions

During the course of 2013, Southern Railway Limited (“SR”) undertook a process to procure new electric multiple units. The purpose of the new units is to provide capacity to enable future rolling stock cascades. The outcome of the process was the selection of Bombardier Transportation (“BT”) to supply 29 x 4-car 110 mph dual voltage class 387/1 units ("the Initial Order") together with associated capital spares and special tools. A manufacture and supply agreement ("MSA") was entered into by SR and BT on 30/07/2013. The MSA includes an option for the purchase of up to 140 additional class 387 vehicles. The value of the contract and options will be in the range of GBP 180m to GBP 500m. SR has made an initial payment to BT and is now seeking to refinance this and obtain finance for the remaining instalments, the purchase of capital spares and special tools and the option vehicles, should the option to purchase these be exercised.