Deutsche Bahn AG (DB), the owner of Arriva Group, has agreed to sell all of the group including all of its operating businesses in ten European markets, to the leading global infrastructure investment manager I Squared.
The sale is expected to be completed sometime next year, subject to receiving approval from the DB Supervisory Board and the Federal Ministry for Digital and Transport of the Federal Republic of Germany.
The sale forms part of DB's Strong Rail Group strategy so that it can focus its resources on its core business and enable further growth in transport by rail in Germany.
Deutsche Bahn acquired Arriva in 2010 and has worked successfully to stabilise its business following the impact of Covid and to focus its sustainable growth strategy on relevant markets. The company has previously sold businesses in its non-core markets, including Arriva Sweden and Portugal last year and Arriva Serbia, Denmark and Poland (Bus) earlier this year.
I Squared is a global company with extensive experience in transport, logistics, energy, utilities, digital infrastructure, and decarbonisation technologies, and has a track record of investing significant capital to support companies in their transition to sustainable modern public utilities. Among I Squared's investments the freight services specialist TIP Group,, the global energy solutions company Aggreko, and the renewables and energy transition companies Conrad Energy and Energia.
Dr Levin Holle, Member of the Management Board for Finance and Logistics and CFO of Deutsche Bahn A, said “We are happy that I Squared is willing to support Arriva in its future growth. Arriva has good prospects for sustainable growth as market liberalisation in Europe progresses.
“The strategic goal of Deutsche Bahn is to make record level investments in environmentally friendly rail in our core business, combined with the massive increase of investment of the German Federal Government into our German rail infrastructure.
“The purchase agreement signed today is therefore in the spirit of Strong Rail. At the same time, the sale to I Squared will give Arriva new options to support its growth potential, for example for the future electrification of European fleets. For us, the agreed sale is an important step to focus even more on additional growth in rail transport in Germany.”
Gautam Bhandari, Global CIO and Managing Partner of I Squared. said “Transport accounts for around one-fifth of global CO? emissions. Three-quarters of this is from road transport, and a greener public transport sector is critical to the shift to lower-carbon infrastructure
“Arriva's strategy for net-zero operations and the decarbonisation of its fleet aligns with our strategy to develop and scale assets with technologies that accelerate the energy transition, as well as providing cleaner air in cities and towns by investing in green public transport.
“We are excited to work with Arriva and we will invest to support its future growth as a major European bus and rail operator.”
Mike Cooper, CEO of Arriva Group, said: “We want to see a future where people choose to leave their car at home, a future with less traffic congestion and cleaner air. This transaction marks an exciting next stage for us, and will deliver significant benefits for our colleagues, our passengers and the many Passenger Transport Authorities we partner with across Europe, enabling us to play our role in delivering a better future.
“I Squared has an established track record of supporting companies which provide essential services, and of investing in the energy transition. We are delighted that they have committed to provide Arriva with long-term capital for investment in innovation across our services, our assets, and our people.
“We're confident that Arriva and I Squared together can play a vital role in delivering innovative and sustainable public transport offerings across Europe.”
