UK's National Express Group sells Essex rail franchise to Trenitalia
National Express Group announced it had reached an in principle agreement for Trenitalia, the passenger rail transportation company part of the state-owned FS Italiane Group, to acquire c2c.
The company said completion of the acquisition - which would signal the end of its involvement in UK rail operations - is conditional upon final consent from the Department for Transport, which is expected to occur within the next three to four weeks.
It said the total consideration is expected to be in the region of £70m, resulting in a small net profit for National Express.
The National Express board said that following initial partnership discussions regarding future franchise bidding, Trenitalia UK made an offer that it said represented the best, and a fair, deal for its shareholders.
It said it was "immensely proud" of its record at c2c, where under its tenure services had been transformed to become one of the UK's best performing rail operations.
"While not ruling out participating in future UK rail contracts, National Express has seen significant growth in North America and continental Europe in recent years," the company's board said in its statement.
"National Express believes there are further opportunities for growth in these markets."
It said the "high-quality services and operations" run by c2c made an excellent fit with Trenitalia's customer-centric approach.
Trenitalia decided to invest in UK rail on the basis of the market's fundamental strength and potential for growth, particularly in light of the Secretary of State for Transport's recently announced vision for reform.
The acquisition marked the first step in Trenitalia's plans to expand in the UK rail passenger market, in line with the internationalisation plans of the entire FS Italiane Group. ■