Virgin's Pendolino tilting trains pulling out of Euston and the rolling stock fleet ferrying commuters into and out of Waterloo fell into Australian hands today as a consortium led by Babcock & Brown took control of Britain's largest train-leasing company.

The £3.6 billion deal for Angel Trains is another part of the fire sale and emergency funding programme at Angel's parent company, Royal Bank of Scotland, which has already raised £12 billion through a rights issue and is aiming to get at least another £6 billion from the sale of personal finance businesses.

Bucking what had appeared to be a dying trend of large debt-financed deals, a consortium led by Australian infrastructure investment house Babcock & Brown and its specialist European buyout fund said today it has raised £2.8 million of long-term financing in a deal which values Angel at £3.6 billion.

RBS had put a price tag of up to £4 billion on Angel whose main customers are Virgin Rail and South West Trains. With 4500 carriages and locomotives out on lease, Angel has 37% of the UK train leasing market, making it the UK's largest rolling stock company or rosco, ahead of Abbey's Porterbrook and HSBC Rail.

"We are delighted to have got a transaction of this size and complexity completed in this market, which has been so adversely affected by the credit crunch," said Simon Gray, Babcock & Brown's British dealdoer. "We have been hunting it down for around nine months and it has been immensely complicated."

Babcock & Brown said it had done the deal despite reservations that the Competition Commission might yet fine the company in an ongoing investigation-The rail regulator had accused Angel and its rivals of fleecing its train-operating customers and indirectly the taxpayer for up to £175 million a year in leasing and maintenance agreements.

Next on the block for RBS is its Direct Line and Churchill insurance business which it hopes to sell for at least £ 5 billion and its £ 1 billion-rated 50% stake in Tesco Personal Finance.