Stagecoach To Pay UK To Push Rail Deal

(Reuters) – BRITISH BUS AND RAIL GROUP Stagecoach will give the government a £100 million ‘change of control’ payment to take over National Express’s rail unit, according to the Sunday Telegraph.

The payment will ensure the Department for Transport (DfT) will not force Stagecoach to relinquish National Express’s East Anglia and c2c franchises as punishment for it failing to honour a £1.4 billion East Coast contract, the report said, without citing sources.

Stagecoach last week said it had agreed in principle to buy National Express’ British bus and rail operations from a consortium made up of Spain’s Cosmen family and CVC Capital Partners if its £765 million takeover of National Express was successful.

The £100 million sum is higher than analysts expected because the two franchises have a combined operating profit of around £30 million a year and have relatively short periods left to run, said the report.

A spokesman for Stagecoach told Reuters that ‘discussions with the DfT are confidential and we cannot comment further at this stage.’

Advertisements