Arriva to acquire German transport company

Leading European passenger transport group, Arriva plc, todayannounced that it has contracted to acquire 85.12 per cent ofGerman bus and rail company Osthannoversche Eisenbahnen AG (OHE)for Euro 30 million (£20.5m).

Arriva-Bachstein GmbH, a consortium between Arriva and regionaltransport operator Verkehrsbetriebe Bachstein GmbH, submitted a bidfor the business after the German federal government, Niedersachsen(regional government in Lower Saxony ) and Deutsche Bahn decided tosell their shares in the business.

Arriva is the major partner in the consortium owning 86 percent. Verkehrsbetriebe Bachstein GmbH holds the remaining 14 percent.

OHE's total combined revenue at full year 2005 was Euro 130million (£89 million) and the business broke even whilstcovering its interest cost.

OHE is an established transport provider based in Celle nearHannover in the north of Lower Saxony . It has over 400vehicles providing bus services in and around Hannover,Braunschweig, Bremen and Hamburg totalling more than 30 millionkilometres per annum.

The business is also a shareholder in Metronom which currentlyoperates two rail passenger contracts with 18 locomotives and 124double decker carriages between Uelzen, Hannover and Gottingen aswell as Bremen, Hamburg and Uelzen. Metronom has also won twofurther contracts in the same region starting in the next threeyears.

OHE owns and manages over 282 kilometres of rail infrastructurelinked to a separate rail freight operation. It also managesfreight and storage at the ports of Uelzen, Wittingen and Luneburgand has additional road freight operations.

The acquisition is subject to approval from the Germancompetition authority and the satisfactory outcome of negotiationswith VBL, the German pension authority. The acquisition isexpected to be confirmed and finalised by the end of February.

Arriva's chief executive David Martin said:

This acquisition will be a welcome addition to ourincreasing European operations and further strengthens our positionin the German transport market. OHE is a diverse business and as aleading European transport group we can use our wide experience tohelp the business develop whilst also learning from our experiencedconsortium partners and the local management team.