The cross-Channel rail operator said it has reached a financing agreement with its shareholders and banks. This includes French state rail company
The cross-Channel rail operator said it has reached a financing agreement with its shareholders and banks. This includes French state rail company SNCF, which is the company’s majority shareholder. The UK sold its Eurostar stake to private companies for £757 million in 2015, and the Government resisted pressure to contribute to the bailout.
Transport Secretary Grant Shapps told MPs in February that the Government was “very keen for Eurostar to survive” but insisted “it’s not our company” and its difficulties were “the shareholders’ problem to resolve”.
Following the announcement of the rescue deal, chief executive Jacques Damas said: “Everyone at Eurostar is encouraged by this strong show of support from our shareholders and banks which will allow us to continue to provide this important service for passengers.
“The refinancing agreement is the key factor enabling us to increase our services as the situation with the pandemic starts to improve.
“Eurostar will continue to work closely with governments to move towards a safe easing of travel restrictions and streamlining of border processes to allow passengers to travel safely and seamlessly.
“Their coordinated actions and decisions are crucial to the restoring of demand and the financial recovery of our business.”
The rail firm’s annual revenues plummeted from £1billion (€1.1billion) in 2019 to about £180milllion (€208million) in 2020, while passenger numbers have plunged by 95 percent from the 11 million people who travelled on its trains in 2019.
It had already £400million (€450million) and received a cash injection of £170million (€197million) from its owners.
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Professor Iain Begg of the London School of Economics said the UK had “no obligation” to help, given it has not been a stakeholder since 2015.
But he added contributing to Eurostar’s long-term future could possibly be in Britain’s interest.
He told Express.co.uk: “There two aspects to this – one is whether there is an obligation or an interest to support Eurostar.
“There is no obligation in the sense that it’s a company owned by French and Belgian railways as well as a hedge fund in Canada, but it may be in Britain’s interest because Brits find the service desirable.
“The next question is if it is not rescued, will something replace it or will there be uncertainty? Will there be a lack of connectivity between the UK and the continent?
“I think the danger is that there could be a lack of decision which would make things very difficult.”