Ashurst advises the European Investment Bank on the financing of the conversion of electric railcars for the Elbe Spree network
15 November 2023
15 November 2023
Ashurst has advised the European Investment Bank (EIB) on the financing of the conversion of 7 six-car Desiro HC electric railcars into 14 four-car electric railcars from the manufacturer Siemens for the Elbe Spree regional rail network. The electric railcars are scheduled to be deployed from mid-2026.
ODEG Ostdeutsche Eisenbahn GmbH (Ostdeutsche Eisenbahn), a subsidiary of NETINERA Deutschland GmbH (NETINERA), had previously been awarded the contract for the operation of local rail passenger transport on the Elbe Spree Lot 1 network in 2019 by the responsible authorities, the states of Brandenburg, Berlin, Mecklenburg-Western Pomerania and Saxony-Anhalt, and purchased 21 Siemens electric railcars for this purpose. The original purchase of the railcars was financed by a consortium also advised by Ashurst (the portfolio financiers) consisting of investors represented by Allianz Global Investors (AGI), Crédit Agricole Corporate and Investment Bank (CACIB) and EIB. The financing was provided via a leasing structure of DAL Deutsche Anlagen-Leasing GmbH & Co. KG.
The responsible authorities have now exercised an option under the transport contract in December 2022, which will lead to the conversion of the electric railcars.
Ashurst's German Project Finance practice regularly advises on asset finance transactions in the context of regional rail transport financings. In contrast to the usual regional rail transport financings, this was the first time that electric railcars, which were already in the operating phase, were converted. The financing is therefore characterised by a complex financing structure that combines new construction phase financing with the existing financing of the existing financiers.
The Ashurst team advised under the leadership of Counsel Alexandra Westerhaus, Partner Derk Opitz, Senior Associate Dr Jan Ulrich Heinemann, Associate Tobias Bürk and Senior Transaction Lawyer Ariana Fazlic (all Project Finance). Counsel Holger Mlynek (Transport) was responsible for the legal due diligence and negotiation of the project agreements.