Friday, April 23, 2010
Deutsche Bahn the government hold company that runs the German railways said that it would acquire Arriva a Britain based Transportation Company as it looks to expand into new markets.
The companies announced the deal to London Stock Exchange after Deutsche Bahn board approved the offer of £1.59 bn or $2.45 bn. The value of Arriva shares at 775 pence, or about 34% above the closing price on March 16, the day before the company announced it was in merger talks.
Deutsche Bahn said the amalgamation had tactical reason because the two companies mutually would have the required level, awareness and experience to make sure efficient competitiveness in growing transport markets.
Arriva come in the continental European market in 1997, now runs bus or road transport and rail transport services in 12 European countries, including Slovakia, Sweden and Portugal. It had been in discussion with French rail transport operator SNCF, one of Deutsche chief rivals but declared in early March that talks had finished.
Based in Sunderland, England, Arriva employs 44,000 people, hold 15,400 vehicles and carriers over a billion passengers a year. It had more than £3 bn in income and £171 mn in working profit in 2008. The economic crisis hurt Deutsche Bahn’s business, with revenue declining 14% in the first half of last year, take the company to seek development in new markets.