Network News
Contributing Writer rail@bauermedia.co.uk
GOING against the current flow of transport operators being sold to overseas interests, Abellio UK is to become a new British-based company called Transport UK Group Limited.
A management buyout of the Dutch Treasury-owned subsidiary of state rail company Nederlandse Spoorwegen will entail Transport UK Group Limited taking over all Abellio UK’s existing rail and bus services, serving London, Liverpool, the Midlands and East Anglia. Its joint partnerships will be unaffected.
The deal, expected to be completed by the end of the year, is being led by Abellio UK Managing Director Dominic Booth (58), who has been in the role for 15 years and has more than 36 years’ rail experience.
“I’ve been a railwayman all my life. I am thrilled to have the opportunity to return key public transport services back into UK ownership at a time when some of our competitors look destined for overseas ownership,” he said.
“Our wish to buy the company demonstrates our confidence in the Abellio UK team. It’s the dedication of our 15,000 employees, together with a continuity of management, that will ensure our new company is a great success.”
The four rail franchises -East Midlands Railway, Greater Anglia (60/40 with Mitsui), Merseyrail (50/50 with Serco), and West Midlands Trains (joint venture: 70% Abellio, 15% JR East, 15% Mitsui) - will be transferred. Also included are 800 buses on 50 routes in west London, run under contract to Transport for London (TfL) and representing 9% of the TfL bus market.
Completion of the management buyout (MBO) is subject to formal approval from the Department for Transport, TfL and Merseytravel, plus regulatory consent from the Office of Rail and Road.
The sell-off has been prompted by NS needing to focus on its Dutch rail operations, as a result of the financial impact of the pandemic.
Sources say that talks about a sale have been going on for a year. Details of the MBO’s financial backers have not yet been revealed, although city sources suggest that it is not necessarily a UK venture capital or private equity firm.
Signing of the financial backing for the MBO was expected as this issue of RAIL closed for press. Details of the backer will then be released.
The announcement came as NS Acting CEO Bert Groenewegen presented NS’ half-yearly results on August 23. He revealed that NS changed its international strategy in 2018 to require foreign activities to “contribute to the interests of Dutch travellers”. With Abellio UK “no longer of strategic importance”, it decided to withdraw.
Although the announcement took the industry by surprise, NS also revealed that the decision was delayed by the uncertainty created by Brexit and then the impact of COVID.
