Alstom deal to fortify Stagecoach’s South Eastern bid

Stagecoach intends to create a deal with Alstom for the South Eastern franchise, subject to Department for Transport consent. Should the deal be approved, Alstom will hold 20% of the share capital of the train operating company.

The Invitation to Tender for the next franchise (currently operated by GoVia) was published on November 29 last year. The ITT states that the franchisee must “collaborate with Network Rail to improve operational performance, enhance the passenger experience and reduce the cost of project delivery, and implement Digital Railway technological solutions”. The plan is for the new operator to work as ‘one team’ with Network Rail.

As well as Stagecoach/ Alstom, bidders for the franchise are GoVia, and a consortium including Abellio, East Japan Railway and Mitsui. Trenitalia was also shortlisted, but withdrew from the race.

The current deal began on April 1 2006, and was initially extended until March 2014. After the DfT review into franchising, it was extended until June 2018 and then December 2018. An extension of one further reporting period is available.

Stagecoach Chief Executive Martin Griffiths said: “Our proposal for a collaboration with Alstom to bid for the South Eastern rail franchise aims to combine Alstom’s knowledge of infrastructure and rolling stock with our operational expertise and customer service focus.”

Nick Crossfield, Managing Director, Alstom UK & Ireland, said: “We have the opportunity to form an even closer partnership with this unique bid for the South Eastern franchise.

“It’s the first time two companies like ours have joined up like this, and together we can offer a better service to passengers and communities along the route.”

While this is the first type of deal on heavy rail, Alstom has been involved in the construction and operation of the Nottingham Express Transit light rail system.