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John Laing Group has announced that, following the receipt of final bids earlier this week, it has agreed to sell its remaining 15% interest in the Intercity Express Programme (IEP) Phase 1 project to a subsidiary of AXA SA, a world-leading insurance and asset management company.

The IEP Phase 1 project comprises a 27.5-year contract to design, manufacture, finance, deliver into daily service and maintain a fleet of 57 InterCity Express Trains and the construction and/or refurbishment of three associated depots for the Great Western main line in the UK, which connects London to Bristol in the south-west. Hitachi Rail Europe is responsible for supplying the trains and ensuring they perform reliably on a daily basis.

The consideration, which is in excess of John Laing's most recent portfolio valuation as at 31 December 2017, is GBP227.5 million (US$316.9 million) (net of costs) and will be satisfied in cash. The transaction is subject to customary anti-trust approval, and consents from the senior lenders to the project. Completion is expected to take place in Q2 2018.

John Laing intends to recycle the capital into future investment commitments. As at 31 December 2017, the Group's pipeline of opportunities in PPP and renewable energy amounted to GBP2.15 billion (US$2.99 billion), including nine shortlisted PPP bids due to close within 18 months and four exclusive renewable energy positions, together representing an investment opportunity of approximately GBP350 million (US$487.5 million).

John Laing will continue to partner with Hitachi to deliver the second phase of the project, which concerns 65 state-of-the-art Super Express trains for the East Coast Main Line, which connects London to Edinburgh. First train delivery is expected by the end of this year.

The trains to be delivered through the programme are bi-modal trains, meaning they can operate on electrified railway tracks and non-electrified tracks by generating their own electricity using on-board engines.

Through special purpose vehicle Agility Trains, John Laing and Hitachi were awarded the PPP contracts for the programme by the UK Department for Transport in July 2012. The total contract value across the two phases is estimated to be GBP5.8billion (US$8.1 billion).