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Plenary Group has achieved contractual close for the Victorian Government’s AUD2 billion (US$1.48 billion) High Capacity Metro Trains project in Melbourne (Australia).

The project includes the delivery of 65 new high capacity trains being built in Victoria over the next six years, and the construction of new maintenance facilities in Pakenham East and Calder Park.

Plenary is the commercial and financial lead, asset manager, and an equity investor in the project, and is part of the Evolution Rail consortium contracted to deliver and maintain the trains over the next 35 years.

Evolution Rail also comprises Downer Group as delivery and maintenance lead, fleet manufacture partner and equity investor, and CRRC Changchun Railway Vehicles as design and technology lead, fleet manufacture partner and equity investor.

The project is privately financed, including senior debt. Evolution Rail’s debt participants will include leading domestic and international banks Westpac, Bank of China, Bank of Communications, HSBC, ICBC, Intesa Sanpaolo, Mizuho Bank and UOB.

Equity financing will come from Plenary (30.1%), Downer (10%), CRRC (10%) and funds managed and advised by global private markets investment manager Partners Group (49.9%).

The first of the new trains is expected to come into service in mid-2019.

Plenary Group CEO Paul Oppenheim said:

“Evolution Rail had moved swiftly from preferred to contractual close over the past few weeks, and will now move to financial close with its partners. The efficiency which contract close has been achieved reflects Evolution Rail’s comprehensive bid which in turn, attracted strong support from our debt and equity financiers who have worked alongside the consortium partners at every step.

“There has been clear collaboration between the public and private sectors with a mutual determination to ensure the project commences on-time and remains on track.”

“We are optimistic about the Victorian Government’s transport infrastructure agenda and this project is set to demonstrate the value-for-money outcomes that can be achieved from running a competitive public-private partnership process.”

“The confidence in Evolution Rail’s solution is demonstrated by the equity stake all consortium partners have taken in the project, and we look forward to delivering another successful PPP for Victoria,” Mr Oppenheim said.

“Plenary was particularly pleased to achieve the introduction of a new international entrant into the Victorian rolling stock manufacturing market (in CRRC Changchun) through a partnership with Downer that will achieve more than 60 per cent local content in the manufacturing of the new train fleet.”