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  1. ITV Report

Abellio withdraws rail bid after Carillion collapse

Credit: Lynne Cameron/PA Archive/PA Images

One of the three remaining bidders for the next Wales and Borders rail franchise has pulled out.

Dutch-owned Abellio Rail Cymru (ARC) has withdrawn from the bidding process as it is 'unable to overcome the impact' of Carillion’s liquidation.

Abellio's withdrawal leaves just two other bidders in contention for the franchise, which operates much of the country's railway network

  • Keolis Amey -French state railways
  • MTR Corporation (Cymru) -Hong Kong's mass transit railway
Carillion collapsed in January with huge debts. Credit: PA

In January Carillion collapsed with debts of around £1.5 billion.

Carillion employed around 20,000 British workers.

In October 2017 Arriva Rail pulled out of the bidding process for the next Wales and Borders rail franchise. Credit: PA

In October last year, Transport for Wales has announced that existing franchisee Arriva Rail had pulled out of the bidding process.

The Welsh Government intends the winner of the Wales and Borders rail franchise to achieve major improvements to the service.

These include new trains and the electrification of the Valleys lines, which will be integrated into a new South Wales Metro that combines trains, trams and buses.

In a statement Ken Skates, economy secretary, explained that despite the 'best efforts of the team of experts, lawyers and counsel at Transport for Wales, and the ARC team, ARC has taken the regrettable decision to withdraw its bid having been unable to overcome the impact of Carillion’s liquidation'.

ARC has participated in the procurement process and has contributed professionally throughout.

It is unfortunate that, having invested significant time, effort and money into the process that they should be a further victim of the liquidation of Carillion.

We have two strong bidders remaining in the process and remain on target to award this exciting contract in May 2018 and to transform rail services in Wales and borders from October 2018.

– Ken Skates, Economy Secretary

Earlier this month the Economy Secretary told ITV Wales' Sharp End that all three bidders are 'world class operators'.

Plaid Cymru Shadow Cabinet Secretary for Economy and Transport, Adam Price AM said the news that Abellio has withdrawn its bid reveals the Labour Welsh Government's 'amateurism' during the process.

Following the profit warnings last year from Carillion - the nominated contractor for Abellio in its bid for the Wales and Borders Franchise - the Welsh Government should have insisted on Abellio including alternative partners in its bid.

– Adam Price AM, Plaid Cymru

We need absolute assurance from Welsh Government that the remaining two bidders are sufficiently able to deliver on the franchise’s objectives and are not also vulnerable to Carillion’s collapse.

Any support required by the remaining bidders should be provided by Ministers so that they remain on track to awarding this contract in May.

– Russell George AM, Welsh Conservative Shadow Secretary for Economy and Transport