He has not set a timetable for selling Arriva Automotive Solutions, but said the group's future lay in bus services, and particularly new opportunities in Europe. 'It is clear that to maximise shareholder value the company must focus its financial and management resources,' he said. 'To this end we are actively seeking to realise the value of Arriva Automotive Solutions. This will bring essential clarity to the group strategy.'
The news will come as a blow to Arriva Automotive Solutions which in December celebrated the removal of 'for sale' signs from outside its offices after six months of uncertainty for staff and customers. The company was put up for sale last June after a downturn in the used car market forced it to issue a profits warning. Its balance sheet was still comfortably in the black, but the cyclical nature of the leasing market sat awkwardly with the City's desire for inexorable annual increases in profits, and Arriva's share price suffered as a result.
During the six months sales process Arriva said it failed to receive an 'acceptable offer' for the business - sources suggested it wanted £250 million for Arriva Automotive Solutions, which runs 54,000 vehicles on contract hire and a further 20,000 on fleet management, but received bids in the region of £150-£200 million.