Rail rivals line up Chiltern
Sunday Times: December 9, 2007
TWO European rail giants are vying to take over Chiltern Railways, the train company that runs commuter and long-distance services from London’s Marylebone station.
Deutsche Bahn, Germany’s national rail company, and NedRail, its Dutch equivalent, are the sole remaining bidders for the UK group. A winner is likely to be announced before Christmas.
Chiltern has been put up for sale by funds controlled by Henderson, the fund-management company. Henderson acquired Chiltern last year when it bought Laing, Chiltern’s parent company, for £950m. KPMG is running the auction.
Chiltern, unusually for a train company, also operates its terminus station, Marylebone, and runs north and west along the M40 corridor from London as far as Birmingham.
Awarded the franchise in 1996 on the break-up of British Rail, it is regarded as one of the successes of rail privatisation. It has earned a good reputation for customer service and invested in extra rail lines to increase capacity.
As well as Chiltern itself, the winning bidder will take control of Laing’s other rail investments. These comprise a half share in London Overground, a recently created franchise that operates commuter trains across the North London line.
It will also own a stake in a new train company, Wrexham and Shropshire, which recently won the rights to operate services from Wrexham to London.
Both Deutsche Bahn and NedRail have been keen to expand into the UK market. The Dutch run train services in the northwest of England and East Midlands in a joint venture with Serco, while the Germans recently bought EWS, Britain’s largest freight-train company.
In a separate move, the German group has applied to run services through the Channel tunnel, raising the prospect of it operating high-speed trains into Europe in competition with Eurostar.