State-owned Arriva is to go back to the private sector, after being sold by the German Government to Miami-headquartered infrastructure firm I Squared Capital.
The €1.6 billion (£1.39bn) deal is expected to complete in 2024, subject to conditions and approvals by the German Government. Sunderland-based Arriva holds national rail contracts for CrossCountry, Chiltern Railways, and Transport for London’s operating concession for London Overground, and owns open access operator Grand Central.
Alongside its UK rail businesses, the deal includes Arriva’s UK bus operations, comprising 5,900 vehicles. Of these, 1,500 are in London, contracted to TfL.
The deal ends a long-running saga that has entailed German state railways Deutsche Bahn (DB) trying to offload Arriva, which it bought in 2010 for €1.6bn.
In 2019, DB said it would dispose of Arriva, either through a direct sale or possible public flotation, putting it back on the stock market. But the plan was put on hold in November of that year.
One of a number of European state-owned rail operators to enter UK rail franchising, DB is now beset by financial woes and is under pressure from the German Government to rid itself of subsidiaries to focus on its core network.
As part of this, DB is also preparing a case for the potential sale of its international freight arm DB Schenker (RAIL 974).
Unions reacted strongly to news of the Arriva sale, with TSSA General Secretary Maryam Eslamdoust saying: “To say the least, it is very troubling to see Arriva Rail sold off in this way to a company with no knowledge or any background at all in the rail industry.”
Founded in 2012, I Squared Capital is a private equity firm that invests in energy, utilities, and telecoms. Arriva is its first public transport purchase, although in 2022 it made an unsuccessful attempt to buy FirstGroup. Since 2018, it has owned road logistics specialist TIP Group, which has subsequently experienced investment and expansion.
SWR to increase services into the West of England
South Western Railway is reinstating services over the Waterloo-Exeter route from December 11, after three years running a reduced timetable because of the COVID pandemic.
From the start of the new timetable, in response to increasing demand, two trains per hour will run
