LONDON (Alliance News) - Go-Ahead Group PLC and National Express Group PLC expressed their disappointment Friday after losing out on Transport for London's Crossrail franchise as the government body stated its intention to award the contract to MTR Corporation (Crossrail) Ltd.
The GBP1.4 billion contract runs for eight yeas and has an option to extend to 10 years.
Transport for London said that its new partner, which operates the Hong Kong metro and is also a partner on the present London Overground concession, will be integral to delivering the new Crossrail services connecting Reading and Heathrow in the west with Shenfield and Abbey Wood in the east.
MTR is expected to employ around 1,100 staff with up to 850 new posts, including almost 400 drivers and over 50 apprenticeships for people from communities along the route, said TfL.
The company will start running the services from May 31, 2015 between Liverpool Street and Shenfield, taking over the stopping services currently operated by Abellio Greater Anglia. They will be using the existing trains that currently operate on the route.
The award follows a procurement process that was announced in June last year; FTSE 250-listed Go-Ahead submitted a joint bid with Kelois, itself a joint venture majority owned by French state rail operator SNCF, for the contract, split 35% to 65%, respectively. National Express Group PLC and Arriva Crossrail Limited also submitted bids for the franchise.
A spokesperson for National Express said Friday, "We submitted a strong, customer-focused bid that we believe would have delivered an excellent service and a fair deal for taxpayers. We are naturally disappointed and will be seeking feedback on our bid from TfL."
The spokesperson added that the company remains confident in its future in the rail market in the UK and abroad.
Earlier this month won Keolis won a new franchise from Transport for London to run the Docklands Light Railway in London from December 7, 2014, following a procurement process which saw bids from UK companies including FTSE 250-listed companies Serco PLC, Stagecoach PLC and Go-Ahead.
In May the UK government awarded the giant new seven-year rail franchise covering a swathe of southeast England to the Govia joint venture majority owned by Go-Ahead Group. The franchise is set to commence in September and combines the current Southern franchise, which runs routes between London and the south coast, with the Great Northern Franchise to the north of London, connecting them with the Thameslink franchise that runs north to south across London.
The Thameslink route is currently going through a GBP6.5 billion upgrade.
Shares in Go-Ahead were trading 1.49% lower at 2,255.00 pence per share. National Express trades 0.88% lower at 258.00 pence per share.
By Alice Attwood; aliceattwood@alliancenews.com; @AliceAtAlliance
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