Stagecoach completes sales negotiations with London bus group
Transport operator buys East London Bus Group for £52.8m
British transport group Stagecoach is set to re-enter the London bus sector after completing sales negotiations with the city's third-largest bus operator.
The firm has purchased the East London Bus Group (ELB) for £52.8 million, having originally sold the operator for £264 million in 2006.
The profitability of ELB has declined following its sale to Macquarie Bank but Stagecoach believes it can turnaround the fortunes of the flagging company.
Brian Souterm, chief executive of Stagecoach, said: "We operated a successful bus business in London for several years and are pleased to re-enter the London bus market at what we consider to be an attractive price.
"Whilst we do not underestimate the challenges we face in driving up the financial performance of the acquired business, we relish the opportunity to apply our expertise in managing UK bus businesses to create value from a turnaround situation."
Stagecoach also confirmed it would make cutbacks to back-office roles in order to improve efficiency and lower costs.