Eurotunnel buys GB Railfreight
Takeover fits tunnel operator's ambition for leading role in European rail freight sector
Channel Tunnel operator, Eurotunnel has bought the third largest UK rail freight operator, GB Railfreight (GBRf).
According to reports, Eurotunnel will pay GBRf’s parent company, First Group, around £30 million (US$44m).
The sale, which was rumoured to have attracted bids from a number of major players, was completed without any increase in Eurotunnel’s debt.
The Channel Tunnel operator said the deal was in line with its strategy of developing a leading position in the European rail freight market.
Chairman and CEO Jacques Gounon said this morning that the acquisition of GBRf meant it would now be able to offer services as far north as Scotland.
GBRf and Veolia Cargo France – acquired in September – would complement the services offered by Eurotunnel’s rail freight subsidiary, Europorte, he added.
Gounon said: “The acquisition of GBRf is a further expression of our commitment to the UK and of our confidence in its potential.
“Growing concerns about the environment and the increasing need for freight transport over both long and short distances mean that rail freight is a buoyant market.”
He said the move would allow GBRf, Veolia Cargo and Europorte, all of which were currently financially sound, to increase traffic.
He explained that deepsea services could sail to the port of Dunkirk and then containers could be transported on trains heading through the tunnel into the UK. This would eleviate anticipated increases in UK port congestion.
It would also allow Eurotunnel to offer new services for intra-European cargo currently travelling on the roads.
Environmental pressures and the increasing cost of fuel would make rail freight a more attractive mode of transport in the future, he added.
And the French government is also investing heavily – €7 billion – in rail infrastructure as it attempts to increase rail freight’s share of traffic to 25% by 2020.
GBRf, which owns 41 locomotives and employs 299 people, generated revenues of £56 million in 2009.
Gounon said GBRf would continue to operate under the same name and with MD John Smith at its head.
According to reports, Eurotunnel will pay GBRf’s parent company, First Group, around £30 million (US$44m).
The sale, which was rumoured to have attracted bids from a number of major players, was completed without any increase in Eurotunnel’s debt.
The Channel Tunnel operator said the deal was in line with its strategy of developing a leading position in the European rail freight market.
Chairman and CEO Jacques Gounon said this morning that the acquisition of GBRf meant it would now be able to offer services as far north as Scotland.
GBRf and Veolia Cargo France – acquired in September – would complement the services offered by Eurotunnel’s rail freight subsidiary, Europorte, he added.
Gounon said: “The acquisition of GBRf is a further expression of our commitment to the UK and of our confidence in its potential.
“Growing concerns about the environment and the increasing need for freight transport over both long and short distances mean that rail freight is a buoyant market.”
He said the move would allow GBRf, Veolia Cargo and Europorte, all of which were currently financially sound, to increase traffic.
He explained that deepsea services could sail to the port of Dunkirk and then containers could be transported on trains heading through the tunnel into the UK. This would eleviate anticipated increases in UK port congestion.
It would also allow Eurotunnel to offer new services for intra-European cargo currently travelling on the roads.
Environmental pressures and the increasing cost of fuel would make rail freight a more attractive mode of transport in the future, he added.
And the French government is also investing heavily – €7 billion – in rail infrastructure as it attempts to increase rail freight’s share of traffic to 25% by 2020.
GBRf, which owns 41 locomotives and employs 299 people, generated revenues of £56 million in 2009.
Gounon said GBRf would continue to operate under the same name and with MD John Smith at its head.
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