Link with high-speed operator offers launch pad into Europe MTR Corp has joined forces with a British company to bid for a rail franchise in England in an attempt to break into the US$20 billion European railway market. The partially privatised company formed a 29-71 joint venture with high-speed rail operator Great North Eastern Railway Holdings (GNER) yesterday to bid for the train service between Ashford in Kent and St Pancras station in London, as well as a new Channel Tunnel rail link from London due to come into service in 2008-09. The Kent project is also associated with residential property development, similar to the MTR's rail-and-property business model in Hong Kong which involves the building of residential flats along new rail lines, generating sales to subsidise heavy rail investment and create passengers. By 2016, about 120,000 new homes are planned for Ashford, the Thames Gateway area in North Kent and towns in the Medway region. 'While the MTR has been active in providing railway consultancy services in the UK, this will be our first entry as a railway operator in this market,' MTR managing director Phil Gaffney said. The Kent franchise, now held by South East Trains, is one of five put up for sale by the British government to improve efficiency and service standards. Witnessing matured growth in fare revenue in Hong Kong and a possible merger with government-owned Kowloon-Canton Railway Corp, the MTR is seeking to break into other markets such as Europe and China. The Kent project will use the celebrated Japanese bullet trains, which will effectively halve the journey time between Ashford and London to 40 minutes and shorten the journey time between Canterbury and London from 90 minutes to an hour. Mr Gaffney said in August that London would provide the MTR with a good base to extend its services to Europe, a massive market which is destined for deregulation by 2008, with its growth rate expected at 50 per cent to 75 per cent in the next 10 years. He also identified Denmark , Germany, Norway and Sweden as the next destinations for the MTR's European ambitions. The MTR has already made its first direct investment outside Hong Kong with a six billion yuan rail project in Shenzhen. GNER, which is part of international freight forwarder Sea Containers, operates train services between London King's Cross, the East Midlands, Yorkshire, Humberside, the north east of England and Scotland. The MTR-GNER venture is competing for the Kent project with Scotland-based bus and rail firm First Group. Reports in London said four consortiums would be shortlisted for the final round of bidding.