UK transport operator FirstGroup is entering the London bus market with the acquisition of a £90m (€109m) bus operator from RATP Développement.
FirstGroup said it has agreed to buy RATP Dev Transit London and its subsidiaries, giving it access to 10 depots across central and west London, a fleet of 1,000 buses and 90 Transport for London (TfL) route contracts.
The £90m enterprise value of RATP Dev Transit London is supported by about £100m in assets, including £50m worth of freehold property, FirstGroup said, adding that it plans to fund the acquisition with £45m from its cash reserves and will take on around £45m in vehicle finance leases.
Graham Sutherland, FirstGroup CEO, said: “This is a significant acquisition for the group that will diversify our portfolio and materially grow our earnings in the medium term. It allows us to enter the London bus market at scale and will also bolster our credentials as we participate in future franchising opportunities across the UK.
“We look forward to continuing to build on our relationship with TfL and welcoming RATP London’s employees into the group, to continue the transformation of the business and to capitalise on the growth potential in the London market.”
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