BERLIN (Reuters) -Deutsche Bahn has agreed a deal to sell its international transport business Arriva Group to Miami-based infrastructure investor I Squared Capital, the companies said on Thursday.
The sale is expected to complete in 2024, pending approval of Deutsche Bahn's supervisory board and the German transport ministry, they said in a statement.
They did not disclose the sale price. Reuters reported last week that the sale would value Arriva, which operates red London buses and train services in the UK, at around 1.6 billion euros ($1.69 billion) including debt, citing sources familiar with the deal.
I Squared's Managing Director Mohamed El Gazzar told Reuters on Thursday that his company plans to invest 2 billion euros in Arriva to grow and electrify its fleet. It would consider complementary and "synergistic" acquisitions in Arriva's key markets including the UK, Italy and the Czech Republic, he said, adding that it is open to both small or sizeable deals of more than 1 billion euros in value.
Citigroup (NYSE:C) advised Deutsche Bahn, and I Squared was advised by Morgan Stanley and UBS.
Arriva transports 1.5 billion rail and bus passengers a year with operations across 10 countries and more than 34,000 employees, according to its website.
Deutsche Bahn, Germany's state-owned railway company, has attempted selling parts of Arriva in the past to raise cash to lower its debt and invest in its domestic infrastructure.
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