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Trenitalia completes £72m deal to acquire c2c

The Italian passenger rail company Trenitalia, a part of FS Italiane Group, has completed the acquisition of London and Essex train operator c2c from National Express Group. Reports Josh Mines.

While a provisional arrangement was reached for the take-over at the start of January, the DfT has officially approved the £72.6m deal which will see c2c’s franchise continue to run until November 2029.  

As guarantor of the agreement, FS Italiane has also paid an additional £35mto settle an existing intercompany loan granted to the franchisee and in which it now acts as lender.

The deal marks the first step in Trenitalia’s wider strategy to expand into the British rail market following the announcement of a joint venture with FirstGroup in bidding for the East Midlands and West Coast Partnership rail franchises.

C2c will still be led by managing director Julian Drury and retain its current organisational structure despite the acquisition.

Barbara Morgante, CEO of Trenitalia, said: “I am pleased that we have been able to conclude this acquisition so rapidly, and we can now immediately start to concentrate on the day-to-day business of c2c.

“Under the leadership of Julian Drury, we will continue to focus on delivering the outstanding service that helped make c2c the best performing operator in the UK and we will collaborate with the management to introduce further improvements.

“In addition to the c2c acquisition, our recent participation in the East Midlands and West Coast Partnership bids shows that we are strongly committed to the UK market, and look forward to passengers increasingly benefiting from our experience, competence and ability to innovate.”

In 2015 Trenitalia, the state owned Italian rail operator, became the first new entrant to be awarded a PQQ Passport by the DfT, a move that allows the company to apply for future franchise competitions without needing to submit the same information each time.

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Andrew Gwilt   14/02/2017 at 00:15

So Trenitalia will keep the "c2c" brand and the Essex Thameside rail franchise until 2029 with 17 brand new trains to be ordered in 2019 as the Class 387's are on hire until 2019. Whilst the Class 357's will still be kept with some being used on metro services and the Class 387's to operate peak time semi-fast service during mornings and evenings. Apparently c2c have been the best train operator in South Essex since 2002 and their punctuality is very good. I like using c2c because it's cheaper to get to London and the trains are kept in good condition. I much prefer c2c than Greater Anglia.

Jerry Alderson   15/02/2017 at 01:49

The £72m is essentially the profit after tax that National Express would have made over the remaining 12 years of the c2c franchise. National Express will also have recovered the bond that it had lodged with the DfT, so that it will now be able to invest that plus the £72m in new business ventures. I'm aware that the Greater Anglia bond that Abellio has lodged with the DfT is approximately £380m (since reduced by 40% as the Japanese will now be covering that). It would be interesting to know what the c2c bond is.

Andrew JG   15/02/2017 at 02:48

As the 6 4-car Class 387/3's are only hired for 3 years max to improve capacity and reliability. c2c should be getting 17 new trains (68 carriages) in a few years if Bombardier are the preffered bidders to manufacture the new Aventra EMU fleets for c2c which could be formed as 5 carriage trains and will replace the hired Class 387/3's once these new trains are ordered and are in passenger service in 2019.

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