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Birmingham Post
Birmingham Post
Business
Graeme Whitfield

Arriva owners consider sale of transport, according to reports

The German owners of North East-based transport firm Arriva are returning to a potential sale of the company, according to reports.

State-owned railway operator Deutsche Bahn is said to be working with advisers on whether there is interest in a deal for Arriva, that could be worth as much as €2bn. Deutsche Bahn acquired Arriva in 2010 and mulled both a sale and a Stock Market flotation of the firm three years before abandoning the processes due to volatility in the UK economy.

Rumours of the deal come at a time of significant interest in the UK transport sector, despite the challenges of building back passenger numbers after the pandemic. That interest saw Newcastle transport group Go-Ahead bought in a £669m deal by a consortium of overseas firms last year, while a German investment group won the battle to take over bus firm Stagecoach.

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Deutsche Bahn revealed at the end of last year that it was formally examining the sale of its DB Schenker rail freight division in a move which could “sharpen DB Group’s focus on its strong rail strategy and on DB’s core business.” No statement has been released on a possible sale of Arriva but the company has confirmed to The Journal that a sale is still on its agenda when market conditions are suitable.

A company spokesman said: “We have always maintained our ambition to pursue a sale transaction or divestment of Arriva subject to favorable market conditions. Considerable progress has been made in refocusing the business portfolio which has been communicated during the course of 2022.

“We do not wish to comment any further.”

Arriva has its headquarters in Sunderland and is one of the North East’s largest companies by turnover, having a workforce of more than 50,000 people in countries around Europe. It operates some local bus services in the North East but lost the Northern rail franchise in 2020.

The company was originally established as TSK Cowie in Sunderland in 1938 as a secondhand motorcycle dealer, before being relaunched as a car dealership with a vehicle hire division. It became involved in the bus sector amid deregulation in the 1980s and renamed itself as Arriva in 1997.

The company was bought by Deutsche Bahn in 2010, when it was de-listed from the Stock Exchange. In the last few months Arriva has announced a number of deals to simplify its operations, including the sale of its bus division in Portugal and the offloading of businesses in Denmark, Serbia, Sweden and Poland.

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