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VIA Rail looks at private funds to build own tracks

NOTE: Only in Canada, would we spend $3 billion to have train speeds that saves only 15minutes in travel time from train schedules between Toronto and Montreal that existed in the1970s (45 years ago!) and think this is a win.

TORONTO STAR - VANESSA LU - With freight traffic clogging railroads, VIA Rail is
considering strategy to raise $3 billion in private investment to build dedicated passenger tracks from Toronto to Ottawa and Montreal.

VIA Rail is looking at raising $3 billion in private investment to buy and build its own dedicated passenger tracks from Toronto to Ottawa and Montreal, a move that could speed up service dramatically.

“We think there is enough money in the Canadian market to fund this type of investment,”
said Yves Desjardins-Siciliano, VIA Rail’s president and chief executive officer, interviewed Monday at Union Station. He pointed to pension plans or insurance funds as likely investors for the proposal.

He would go out to the global market to find interested investors — possibly as a public-private partnership, promising “double digit” returns. Or it could be bonds, or even green bonds.

“It’s an excellent time to raise money for infrastructure,” Desjardins-Siciliano said, pointing to low interest rates.Institutional investors have slowly diversified from equity investments and fixed income into long-term infrastructure, such as toll highways, airports and even rail infrastructure.

He argues that Canada and its passenger rail tracks would be a good investment, given that those who invest in infrastructure for 30 to 40 year terms want to ensure their money is in a good economy with a stable political situation.

Desjardins-Siciliano cautioned that VIA Rail is still working on its business case strategy and will take its proposal to its main shareholder, the federal government later this year.

If the plan is approved, VIA Rail could be raising money in Canada and around the world by this time next year, with dedicated passenger tracks in place in four to seven years.