For the first time in two decades, 21% stake in the company that runs the undersea tunnel between England and France will be offered to funds. Two funds handled by Goldman Sachs opted to convert their bonds in Groupe Eurotunnel into shares.

It was specified by Eurotunnel that nearly 21.2 per cent of Groupe Eurotunnel would be held by the two funds, together known as Goldman Sachs Infrastructure Partners, soon after the conversion takes place. It is expected that over the next few years, the shareholding is likely to fall to about 15.2 per cent, since instruments developed during the company's 2007 conversion turn into shares.

The funds were able to acquire their stakes after underwriting the issue of deferred shares, when Eurotunnel invested €1.75bn ($2.5bn) in fresh capital last year.

A majority of the proceeds were used to purchase convertible debt instruments made during Eurotunnel's 2007 restructuring. This slashed the company's overall debt from €9.18bn to €5.85bn.

"The funds are converting the instruments into shares at the first opportunity because they want to see Eurotunnel's once-complex capital structure simplified, according to one person involved," said a source.