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Arriva for sale?

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Bletchleyite

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Northern would be excluded? That's interesting - is it so poisonous that nobody will touch it? What will happen to it then I wonder? Directly managed by DB Regio AG (as Chiltern was prior to it being placed into Arriva when DB took it over)? Or the keys handed back?
 
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LNW-GW Joint

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I can't see anything strategic for Arriva in the Carlyle portfolio.
Maybe they want entry into the EU transport sector.
Nothing leaps off the page as a match for Arriva.
But then the Roscos and freight boys have had some unlikely owners over the years, usually selling on in a few years without changing much.
Looks like DB will have to pay DfT to take Northern off their hands before the deal is done.
 

Killingworth

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Northern would be excluded? That's interesting - is it so poisonous that nobody will touch it? What will happen to it then I wonder? Directly managed by DB Regio AG (as Chiltern was prior to it being placed into Arriva when DB took it over)? Or the keys handed back?

The strong hint there is that Northern is about to be taken back into state control!
 

w1bbl3

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Carlyle will IHMO be looking at Arriva as a revenue business rather than anything particularly strategic probably dispose of the bits that aren't profitable enough as trade sales or when franchised not rebidding the franchise. They've owned transport assets before notably W&G which was sold for large profit and still own Addison Lee having acquired it just before Uber hit...
 

bussnapperwm

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What's further interesting is that there have been rumours and speculation on the wmbusphotos forum of a takeover outside of this deal of Arriva Midlands's Cannock depot with speculation that its a company that has Julian Peddle as a director that is involved.
 

overthewater

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What's further interesting is that there have been rumours and speculation on the wmbusphotos forum of a takeover outside of this deal of Arriva Midlands's Cannock depot with speculation that its a company that has Julian Peddle as a director that is involved.

Is that in connection to this deal or just because Arriva in the midlands what Rid?
 

Anthony ross

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I wonder what the specific company is if the rumour is true about Cannock it could either be centrebus, D&G, select or Midland classic
 

duesselmartin

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German news Tagesschau reports today that the sale of Arriva has been stopped as the price would be under value.
 
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duesselmartin

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German news Tagesschau reports today that the sale of Arriva has been stopped as the price would be under value.

https://www.en24.news/2019/11/proceeds-insufficient-bahn-stops-sale-of-arriva.html

Deutsche Bahn wants to sell its foreign traffic subsidiary Arriva to bring additional money into the tight box. But it does not go as hoped. The group now apparently pulls the emergency brake.
For the time being, Deutsche Bahn will stop the planned billions sale of its foreign subsidiary DB Arriva. The expected proceeds were significantly below the book value, it said in the environment of the Group. The Supervisory Board and the Management Board want to discuss this during a special meeting of the Supervisory Board in the afternoon. The sale should actually bring additional billions for the railway in Germany. The group had been looking for a buyer for months and at the same time prepared an initial public offering as Plan B.

Uncertain is the future of the responsible board member Alexander Doll. According to media reports, there are efforts to replace the chief financial officer. A railway spokesman did not want to comment on supervisory board matters. Arriva operates buses and trains in 14 European countries, but makes well over 60 percent of its sales in the UK, where it is based. An IPO therefore carries risks because it is not certain when and how Britain will leave the EU.

Media reports talked about possible proceeds of up to four billion euros. Of this, debts of more than one billion euros and pension obligations still have to be deducted. The railway is heavily in debt. After the planned sale had tightened, the supervisory board decided in September, first over a bond up to two billion euro fresh money to take up.

Arriva has been part of the largest German state-owned company since 2010. Years ago, Deutsche Bahn wanted to partially bring its daughter to the stock market. After the vote of the British for an EU exit and a financial injection of the federal government the plans were stopped 2016 however.

The supervisory board also wants to appoint a new boss for the cargo division DB Cargo on Thursday. The head of Berlin's public transport company, Sigrid Nikutta, is to get the goods business out of the red after a suggestion from the Personnel Committee and to get a post on the Executive Board.
 
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Simon75

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Rumour via Arriva Macclesfield drivers is that Julian Peddle is interested in Arriva Winsford and Macclesfield.
Winsford would be with D&G and Macclesfield with High Peak

Also Stagecoach interested in Arriva Runcorn
 

markymark2000

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Also Stagecoach interested in Arriva Runcorn
Stagecoach has been after the Halton area for yonks. Halton Transport and Arriva Runcorn have been rumored for as long as I can remember.


In my opinion, DB should have gone with selling up parts from day 1 and not selling the whole brand as it was never going to work. If you look at some of Arrivas operations, they are running them down slowly. It's just a matter of time for some depots to be closed.
 

Robertj21a

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Stagecoach has been after the Halton area for yonks. Halton Transport and Arriva Runcorn have been rumored for as long as I can remember.


In my opinion, DB should have gone with selling up parts from day 1 and not selling the whole brand as it was never going to work. If you look at some of Arrivas operations, they are running them down slowly. It's just a matter of time for some depots to be closed.

You do realise that Arriva's bus operation in the UK is only a small part of Arriva as a whole ?
 

markymark2000

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You do realise that Arriva's bus operation in the UK is only a small part of Arriva as a whole ?
If you sold the individual parts of the business though, they can go to people who only want certain parts of the business or only have enough money for a small part so you are increasing the potential amount of bids for each part of the business. People can still put in combined bids to get larger chunks of the business.
 

HH

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If you sold the individual parts of the business though, they can go to people who only want certain parts of the business or only have enough money for a small part so you are increasing the potential amount of bids for each part of the business. People can still put in combined bids to get larger chunks of the business.
But on the downside it will cost you a lot more to sell piecemeal and take years.
 

Volvodart

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DB plans Arriva flotation in May

https://www.railwaygazette.com/policy/db-plans-arriva-flotation-in-may/55284.article

DB plans Arriva flotation in May
4 December 2019
Save article
de-arriva-db-logo

GERMANY: Deutsche Bahn is looking to float its international public transport operating subsidiary Arriva on the stock market next year, CEO Richard Lutz told local media on December 4.

The state-owned railway holding group had been negotiating a trade sale of Arriva in a bid to shore up its finances and get its borrowing back below the agreed debt limit. However, the disposal process was halted by the DB AG Supervisory Board last month, when it became apparent that none of the reported 10 interested bidders was willing to offer the €3∙5bn to €4bn that DB had been hoping to raise.

In particular, concerns had emerged over the scale of Arriva’s pension liabilities in the UK, valued at more than €400m, and some bidders reportedly wanted the troubled Northern franchise to be excluded from the sale. Following a special Supervisory Board meeting on November 18, DB announced that its Executive Board Member for Finance, Alexander Doll, would be leaving the company at the end of this year

According to Lutz, DB is now looking to float a minority stake in Arriva with an IPO in May 2020, and then offload its remaining shares in further tranches over the next three years. ‘We definitely want to go public next year and then sell in an extended process’, Lutz explained. Meanwhile, he suggested that DB would be looking to raise €3bn through a bond sale in the coming months.
 

DavidGrain

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Surprised the article doesn't say which market Arriva will be floated on!

Yes I wondered as well. Months ago when that was one of the ideas being mooted there was some discussion on this subject whether it would be Frankfurt or London. Even Amsterdam was being mentioned. I see that Richard Lutz, CEO of DB, was appointed a director of Arriva plc on 20th Novemeber
 

js1000

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'Some bidders reportedly wanted the troubled Northern franchise to be excluded from the sale.'

Privitisation for you in a nutshell. Pillage the profits from successful arms. Dump the loss making ones on the taxpayer. Little surprise the idea of rail 'nationalisation' is such a popular idea among the general public.

The DfT probably want to end the Northern saga as much as the passengers but want Arriva to pay the penalty for reneging on the franchise agreement. They know the subsidy for the Northern franchise falls sharply next year and Arriva will have a loss making entity that they will just have to cut their losses on.
 

Robertj21a

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'Some bidders reportedly wanted the troubled Northern franchise to be excluded from the sale.'

Privitisation for you in a nutshell. Pillage the profits from successful arms. Dump the loss making ones on the taxpayer. Little surprise the idea of rail 'nationalisation' is such a popular idea among the general public.

The DfT probably want to end the Northern saga as much as the passengers but want Arriva to pay the penalty for reneging on the franchise agreement. They know the subsidy for the Northern franchise falls sharply next year and Arriva will have a loss making entity that they will just have to cut their losses on.

Is rail nationalisation '.......such a popular idea among the general public ' ? I thought most of the general public had realised that it would solve a few problems, but create a whole load more ?
 

3141

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Is rail nationalisation '.......such a popular idea among the general public ' ? I thought most of the general public had realised that it would solve a few problems, but create a whole load more ?

Unfortunately many people seem to think that some big organisational change will magically solve all the problems. Or they support it because other people that they don't like are against it. There's a much bigger issue facing the country that was voted through for much the same reasons, and will also create a whole load more problems, but it would be off-topic to spell it out here.
 

Mikey C

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'Some bidders reportedly wanted the troubled Northern franchise to be excluded from the sale.'

Privitisation for you in a nutshell. Pillage the profits from successful arms. Dump the loss making ones on the taxpayer. Little surprise the idea of rail 'nationalisation' is such a popular idea among the general public.

The DfT probably want to end the Northern saga as much as the passengers but want Arriva to pay the penalty for reneging on the franchise agreement. They know the subsidy for the Northern franchise falls sharply next year and Arriva will have a loss making entity that they will just have to cut their losses on.

That's not what the article suggests. If Northern was excluded from the Arriva sale, it would remain with DB. The German taxpayer perhaps :D
 

LNW-GW Joint

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Or handed back to the UK government ?

No, the liability stays with DB.
The DfT would have to approve any change in ownership (of any of the Arriva franchises), and would expect the "parent" to meet its guarantees before (or after) agreeing to any change.
DB already had to donate a Mk3 set to ATW when it took over Chiltern and London Overground.
It resources the Manchester LHCS for TfW.
 

Robertj21a

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No, the liability stays with DB.
The DfT would have to approve any change in ownership (of any of the Arriva franchises), and would expect the "parent" to meet its guarantees before (or after) agreeing to any change.
DB already had to donate a Mk3 set to ATW when it took over Chiltern and London Overground.
It resources the Manchester LHCS for TfW.

But, presumably, if the service was so poor then the TOC would have to be replaced ?
 

LNW-GW Joint

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But, presumably, if the service was so poor then the TOC would have to be replaced ?

Yes, but it will cost DB to exit the contract - just as it cost VTEC.
Essentially it pays for all the refranchising costs, plus calling in the parent penalties (performance and season ticket) in the contract.
Even going to a direct award (ie reducing to a management contract) will probably cost DB.
They will probably be held to the contracted financial performance to the point of contract change.
 
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