UK bus and rail operator Arriva bought by giant US firm
Deutsche Bahn offloads company to I Squared in deal worth £1.4bn, three years after putting it up for sale US infrastructure investor I Squared has bought the London red bus operator Arriva for €1.6bn (£1.4bn), a deal believed to be worth around €1 billion. This comes more than three years after Deutsche Bahn, its German owner, put the company up for sale in 2019 to reduce its own debts. While the terms of the deal were not disclosed, it is understood to have sold Arriva to DeutscheBahn for € 1.6 billion, including debt. The acquisition comes after significant efforts to stabilise the business following the Covid pandemic, which brought most public transport to a halt. The deal is expected to be completed next year.
Diterbitkan : 2 tahun lalu oleh Kalyeena Makortoff di dalam Business
The London red bus operator Arriva has been snapped up by US infrastructure investor I Squared in a deal believed to be worth about €1.6bn (£1.4bn).
The deal comes more than three years after its German owner, Deutsche Bahn, put the company up for sale 2019, having originally sought to offload Arriva to reduce its own debts.
While the terms were not disclosed, Deutsche Bahn is understood to have sold Arriva for about €1.6bn, including debt. The sale comes after significant efforts to stabilise the business after the Covid pandemic, which brought most public transport to a halt.
However, the value of the deal suggests Deutsche Bahn– which has been described as being in a state of “permanent crisis” by Germany’s national audit office – made a loss on the sale, having paid €2.7bn for Arriva in 2010. The transaction is expected to be completed next year.
Arriva, which is headquartered in Sunderland and employs more than 34,000 people, operates bus and rail services across 10 European countries, including the UK, where it is one of the largest rail operators and runs a 4,700-strong fleet of buses across the country, including some of London’s famous doubledecker red buses.
It operates the London Overground rail network, as well as the Chiltern Railways and CrossCountry franchises.
A spokesperson for I Squared – which is headquartered in Miami – said the US infrastructure fund had committed €2bn to expand and electrify Arriva’s fleet after its takeover, with a significant portion of those funds expected to be spent on its UK operations.
The deal follows I Squared’s failed £1.2bn bid for FirstGroup last year, which was rejected on the basis that it undervalued the UK rail and bus operator.
The Arriva Group chief executive, Mike Cooper, said the deal would give the company “a new lease on life”, while the Deutsche Bahn chief financial officer, Levin Holle, said he was happy that the new owners were “willing to support Arriva in its future growth”.
Arriva will be added to I Squared’s growing list of European investments, which include the UK power generating companies Conrad Energy and Aggreko, and contribute to its $37bn (£30.5bn) in total assets.
“This is a great opportunity for Arriva and the start of an important new chapter for our business,” Cooper said. “I know that the team at I Squared share our belief in providing sustainable transport services that cater for the needs of tomorrow, as well as the pressures of today.”
Topik: United Kingdom