One of the regularly aspects of the new stock order is that the Class 378s
will be owned directly by TfL, not leased from a Rosco like most mainline
stock; this line has been taken by most of the rail mags and other sources.

However the latest TfL 'board papers' include the following:

"Overground Train lease deal
On 20 December the operating lease for the new rolling stock fleet for the
London Overground was completed. The transaction, approved by the TfL
Board in June 2007, removes the assets from TfL's balance sheet. As a
consequence, the lease frees up £250 million of balance sheet capacity for
reinvestment on other projects.
-------
The lease runs to 2027. On expiry, TfL has the option to acquire the trains,
to enter into a follow-on lease or to hand back the trains to the lessor
(without any exposure to the residual value of the trains at that point).
This provides TfL with additional flexibility that did not exist prior to
signature of the lease - if TfL had wished to sell the trains at that point
it would have been exposed to risk of the market value at that time."

Are they going back to the Rosco style setup after all then, or leasing
directly from Bombardier?

Paul S

Am Wed, 13 Feb 2008 13:40:38 UTC, schrieb "Paul Scott"
auf uk.railway :

On 20 December the operating lease for the new rolling stock fleet for the
London Overground was completed. The transaction, approved by the TfL
Board in June 2007,

question is, who is the leaser? Is it TfL or is it LOROL?


Curious,
L.W.

On 13 Feb, 13:40, "Paul Scott" wrote:
One of the regularly aspects of the new stock order is that the Class 378s
will be owned directly by TfL, not leased from a Rosco like most mainline
stock; this line has been taken by most of the rail mags and other sources..

However the latest TfL 'board papers' include the following:

"Overground Train lease deal
On 20 December the operating lease for the new rolling stock fleet for the
London Overground was completed. The transaction, approved by the TfL
Board in June 2007, removes the assets from TfL's balance sheet. As a
consequence, the lease frees up £250 million of balance sheet capacity for
reinvestment on other projects.
-------
The lease runs to 2027. On expiry, TfL has the option to acquire the trains,
to enter into a follow-on lease or to hand back the trains to the lessor
(without any exposure to the residual value of the trains at that point).
This provides TfL with additional flexibility that did not exist prior to
signature of the lease - if TfL had wished to sell the trains at that point
it would have been exposed to risk of the market value at that time."

Are they going back to the Rosco style setup after all then, or leasing
directly from Bombardier?

Paul S


Yes, my attention was drawn to that courtesy of an entry on Mr Thant's
splendid London Connections blog:
http://londonconnections.blogspot.co...ellaneous.html

I would strongly expect that TfL is leasing them from the manufacturer
Bombardier, and no Rosco will be involved. I think that the
arrangement was to have Bombardier be responsible for servicing the
new trains anyway (i.e. prior to this announcement), so this would
appear to merely just be a development on that.

As the above extracts seem to make clear, the incentive behind the
leasing as opposed to buying the stock is so the asset's don't appear
on TfL's balance sheet - bearing in mind that the government gave TfL
permission to borrow money directly for their investment programme, so
juggling assets around like this does make a difference on the books,
so it seems like a sensible change.

Of course back in reality there won't be much difference (unless
Bombardier decide to copy Porterbrook, who put plaques in their trains
that state "This train in the property of Porterbrook" - like anyone's
going to nick it!).

On 13 Feb, 14:43, "Lüko Willms" wrote:
* question is, who is the leaser? Is it TfL or is it LOROL?


If TfL is concerned about the assets appearing on its balance sheet,
that suggests to me that it will be TfL leasing the stock.

PhilD

--

On 13 Feb, 14:43, "Lüko Willms" wrote:
Am Wed, 13 Feb 2008 13:40:38 UTC, schrieb "Paul Scott"
auf uk.railway :

On 20 December the operating lease for the new rolling stock fleet for the
London Overground was completed. The transaction, approved by the TfL
Board in June 2007,

question is, who is the leaser? Is it TfL or is it LOROL?

Curious,
L.W.

TfL.

On Wed, 13 Feb 2008 07:58:28 -0800 (PST), Mizter T
wrote:

it seems like a sensible change.

Only in the sense that it'll cost them more overall. That doesn't
strike me as sensible in the slightest, just a typical piece of
modern-day short-termism.

Neil

--
Neil Williams
Put my first name before the at to reply.

On 13 Feb, 20:22, (Neil Williams)
wrote:
Only in the sense that it'll cost them more overall. That doesn't
strike me as sensible in the slightest, just a typical piece of
modern-day short-termism.

The bit Paul left out addresses that:

"Additionally, the effective cost of finance
(approximately at London Interbank Offer Rate, LIBOR) compares
favourably
with other sources of funding used by TfL in the past - e.g.
borrowings from
the European Investment Bank or a capital markets bond issue."

What alternative are you suggesting would be cheaper?

U

--
http://londonconnections.blogspot.com/
A blog about transport projects in London

On 13 Feb, 20:22, (Neil Williams)
wrote:
On Wed, 13 Feb 2008 07:58:28 -0800 (PST), Mizter T

wrote:
it seems like a sensible change.

Only in the sense that it'll cost them more overall. That doesn't
strike me as sensible in the slightest, just a typical piece of
modern-day short-termism.

Neil


Well, perhaps it's sensible within the constricts of how TfL operates,
not least since such financial manoeuvring is now the way of the
world.

Don't get me wrong Neil, I'm certainly minded to agree with your broad
point. However TfL are fairly wily operators so perhaps also have
their eyes on other things - e.g. it may impress the Treasury who
might then be minded to give TfL more money, or indeed it might
impress potential lenders who naturally analyse TfL's balance sheet
and assess the risk.

One could develop this further - the recent "global credit crunch"
could have led TfL to believe they're going to have a harder time
borrowing money in the future, so instead they've cashed in the £250
million and now have it to spend on other things - and there are a
great many other projects that are yearning for that cash, perhaps
particularly so in the context of the strain that Crossrail will put
on TfL's finances.

On Wed, 13 Feb 2008 13:02:43 -0800 (PST), Mizter T
wrote:

One could develop this further - the recent "global credit crunch"
could have led TfL to believe they're going to have a harder time
borrowing money in the future, so instead they've cashed in the £250
million and now have it to spend on other things - and there are a
great many other projects that are yearning for that cash, perhaps
particularly so in the context of the strain that Crossrail will put
on TfL's finances.

This latter point about TfL's budget overall is the key point. There are
massive pressures post 2010 despite the recently announced government
settlement. Anything that can free up cash is sensible in that context.

Not so sure about the global credit crunch - TfL generally has a very
good rating in terms of its debt and overall financial management. There
is usually a report on this in the TfL Board Papers.
--
Paul C

Am Wed, 13 Feb 2008 15:58:28 UTC, schrieb Mizter T
auf uk.railway :

I would strongly expect that TfL is leasing them from the manufacturer
Bombardier, and no Rosco will be involved.

Your expectation was not strong enough:


------- quote -------------
31 January 2008

ANGEL TRAINS ORDERS "GREEN TRAINS" FOR THE UK RAIL MARKET

Angel Trains has placed a major order for Class 172 cars from
Bombardier Transportation's next generation 'Green Trains' for London
Overground Rail Operations Limited (LOROL) and Chiltern Railways. The
contract, worth approximately 33 million GBP, is for eight 2-car next
generation diesel multiple units for use on the London Overground
network and four 2-car units for Chiltern Railways.
----------- unquote ---------
full: http://www.angeltrains.com/press/release.aspx?Id=692


Cheers,
L.W.