How Shoosmiths worked as part of a trio of law firms to structure a groundbreaking £210million deal in the rail sector...
"This is an important transaction for Siemens, which represents the first post-Thameslink platform for their Desiro City product, and the first to be funded by a ROSCO."
Banking partner at Osborne Clarke
Shoosmiths advised Stagecoach South Western Trains (SSWT) on its 3-way contractual negotiations to source the production (for delivery in 2017) of 30 new Desiro City trains from train manufacturers Siemens Rail Systems Division, to be financed and leased by rolling stock company Angel Trains.
- The delivery to SSWT in 2017 of 150 new train carriages will provide extra peak time capacity for 24,000 commuters in and out of London Waterloo.
- The deal is part of a long-term strategy with the Department for Transport (DfT) to ease congestion in the capital. It will create around 140 new jobs for drivers, engineers and maintenance staff.
- A groundbreaking aspect of the deal was the negotiation of the way the new trains would be maintained. While Siemens is contracted to maintain the trains until 2019, the work for this period will actually be carried out by a team from SSWT, seconded to Siemens for that purpose.
- This means SSWT will be able to take the maintenance back in house after the agreement for this service comes to an end. As a result, SSWT will gain an informed and expert maintenance team within its business, as part of the deal, streamlining its long-term costs.
- Shoosmiths advised SSWT on the complex contractual issues and in particular provided specialist employment law advice on the novel secondment arrangements.
- This secondment is thought to be the first of its kind in the UK rail industry.