Stagecoach Devon / First Devon & Cornwall merger inquiry
From:
Published:
11 August 2015
The
CMA is investigating the anticipated acquisition of the Plymouth depot
business and certain associated assets of First Devon & Cornwall
Limited by Stagecoach Devon Limited. Phase 1
Invitation to comment: closes 25 August 2015
11 August 2015: The CMA is considering whether it is or may be the case that this transaction has resulted in the creation of a relevant merger situation under the merger provisions of the Enterprise Act 2002 and, if so, whether the creation of that situation has resulted, or may be expected to result, in a substantial lessening of competition within any market or markets in the United Kingdom for goods or services.Contact
Please send written representations about any competition issues to:David Little
Competition and Markets Authority
Victoria House
Southampton Row
London
WC1B 4AD
david.little@cma.gsi.gov.uk
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reprinted here so if you want to have a say in the matter then you know who to write to!
Looks like the competition & markets authority doesn't want this transaction to go ahead. Personally its going to happen anyway whether they like it or not. Most people have known First didn't want to be in Plymouth for some years, so why hasn't anything been done by them to support First or try to have a plan in place so First could leave. Personally I think they should just keep their nose out if it, but then again Im guessing civil servants don't have much to do since the West Coast balls up!
ReplyDeleteIt's routine, not unexpected and isn't likely to amount to anything for the reason you state: namely that if Stagecoach hadn't come along and saved some services and jobs, then First would have just closed down and all jobs would have been lost. I don't doubt that First and Stagecoach will point this out vigorously. Yes, there's less competition going forward than there has been but there'll be a darn sight more than if First just pulled out and laid everyone off.
DeleteI'm not sure what you mean by "why hasn't anything been done by them to support First" - it's not down to the CMA or anyone else to help people compete or to to force them to do so. If the CMA has any sense they will know now that long-term on-street bus competition simply isn't sustainable and as per North Devon, if they prevent Stagecoach from buying Plymouth, they will actually end up reducing the amount of competition in the area. No-one else is likely to step in instead of Stagecoach, the opportunity to buy it has been there for two or three years and even Stagecoach weren't keen the first time round.
What benefit is this to the bus user. A total and absolute waste of time. Its a done deal.the only party that should be scrutinised r First. Crap buses and cheap but no fair fares are not the answer.
ReplyDeleteAre these people mad?. Nothing First and Stagecoach ever do could be counted as a merger. Deadly enemies most of the time. So if First want out and Stagecoach want in then what is the problem?. Stagecoach hardly compete on existing routes and the situation with change from First competing with Citybus to Stagecoach competing with Citybus..
ReplyDeleteWhat a total joke.. waste of time and money! They can not stop this going through. If they did, First would just close down and that would leave a monopoly situation with Go Ahead.. that would be anticompetitive!
ReplyDeleteThe CMA are entitled to investigate any purchase, and Stagecoach have had more investigations than most over the years. Therefore this process is not alien to them. It will mean lots of work to satisfy them. But they've been here before, and have managed to put forward cogent arguments in their quest to buy businesses. No doubt they shall do the same in this investigation.
DeleteSome of these investigations they will win, and some they will lose. They've not gone competing heavily with First in the Plymouth area in recent times and they can justifiably say they're the white knights riding in, that this business is loss making and will fail if not sold. One of Stagecoach's asset purchases last year in Manchester was subject to investigation and was cleared.
The CMA don't just regulate buses, they regulate all types of business mergers. In regional terms this is an expansion of one business into an adjoining area, with the loss of a competitor. This would attract CMA interest in any other area where consolidation takes place.
Stagecoach have an excellent recent track record in turning around failing businesses, all of which will be taken into consideration during the investigation.
the reason that C M A are checking the sale off first and stage coach byeing
ReplyDeletecouse there had 1000,s off letter,s about stage coach on takeing on all first bus busy routes in Plymouth
I wrote a letter to stage coach and there not even email .or ring ,bk
at least first bus get bk to u
Id be amazed if they get 1000s of letters. Id be amazed if they get more than a few if any from passengers, No one out there has even heard of the CMA!. Most passengers are still unaware of the changes and wont notice till they try to catch a bus on the 7th and it either doesn't turn up or its a different colour. The CMA investigate pretty much all of these deals. it is routine. that's what they do. They wont be looking at Plymouth as that's not the competition issue at stake here, its the rest of South Devon that will concern them.
DeleteI'd be surprised if they could read your letter!
DeleteCan anyone understand this person?
Deleteprobably didn't understand a word.
DeleteI can understand why you had no reply, i would not bother either.
Deletefirst devon and cornwall buses
ReplyDeletethe company was not put on the open market for sale witch there should off done ,so orther bus companys could of bought first bus
first bus got in touch with stage coach and done a private sale ,I been told this bye driver,s
so first bus may have broke the law
Firstly the company has been up for sale for ages. If anyone else had wanted it they could have made an offer. The reality is that it was loosing money so no one wanted it, just like First Group didnt want it either.
Deleteas for breaking the law - how?
Totally wrong Anon 13/8 19:53
DeleteThis is a private business seeking to exit a specific area, and they are entitled to go to any buyer they choose. It is not the same type or sale as occurred Plymouth Citybus when the City Council wished to sell it where they did ensure there was a wide variety of bids in order to obtain the best price.
Likewise the CMA can investigate any merger they deem fit - reference areas for other investigations have been much smaller. As this is a consolidation of the market it will generate interest from competition authorities.
I would pay a little more caution to what drivers might say. Drivers are a wonderful source of fascinating rumours, some of which would score highly if we were awarding the Booker prize for fiction.
In all honesty only the people higher up in the businesses concerned will be fully appraised of the true facts, and there are such things as non disclosure agreements which prevent disclosure of confidential information for just these types of sale.
Anon 19:53 absolute rubbish. There is no law that dictated that it had to be sold publicly but as Graham says, it has been on the market for the last 3 years.
DeleteFor a parallel, look at Finglands purchase by First. A loss maker that would've been closed had First not bought it. The CMA did investigate as routine and the purchase cleared. You'd expect the same with First Devon.
As a footnote to all of this, First Devon & Cornwall Ltd was renamed First South West Ltd as from 6 August. No real surprise given they'll only be running in Cornwall and Somerset shortly.
ReplyDeleteI am shocked at what has happened in Southampton, First network there being cut to bits just like Plymouth and Northampton before it. Wouldn't surprise me if Soton is offloaded within a year or 2.
ReplyDeleteCut to bits? The 5 is chopped as it was marginal having been blown out of the water by chunks of Uni services. The resources saved are being deployed elsewhere.
DeleteAlso, Soton is part of FHD (with Hoeford and Hilsea depots) and they have replaced much of the fleet in the last 3 years. So nothing like Northampton or Plymouth
Have a look at the 2009 and 2014 Soton network maps at http://sotonbus.blogspot.co.uk/2015/08/timetables-out-map-nostalgia.html and tell me if you disagree that's a network in serious decline. Exactly the sort of constant tinkering with routes, links and service numbers that killed Northampton and Plymouth.
DeleteAs N'hampton knows only too well there's very little stopping First from investing in new buses then whisking them away elsewhere after no time at all.
I thought we were talking about the cuts now not 5 years ago.
DeleteThe decline of First over that period is well documented. However, things are markedly different now. Problem is that the underinvestment and top down management left a business with serious problems. That underinvestment saw vehicles being moved - robbing Peter etc. They are tackling the age profile and putting things right but it takes time and some businesses were beyond salvation like Northampton and Plymouth.
First won't be leaving Southampton any time soon.
Historically PCB have had 75%-80% of the market share in Plymouth, First & predecessors had about 20% & the independents had the remaining 5% so based on that the CMA won't do anything to stop the takeover
ReplyDeleteJudging by the condition of the first Stage coach vehicles that have arrived in Plymouth today, even with the reduced services, passengers will be more than pleased with the contrast between old and new. The professionalism and attitude of the drivers has been commended on by covert passengers who were observing the general attitude of the Plymouth drivers over the past few weeks on behalf of Stagecoach. This is even with the doom and gloom surrounding the depot over the past few years and condition of worn out vehicles. Given the right encouragement and support Plymouth will prove to be a sound investment for Stagecoach who will soon realise the efforts that have been made and gone unacknowledged in the past through bad Management. It has been said in the past if the team at work in First Plymouth had the resources of PCB things would be very different. This may be the turning point. As an employee and even though my job may be at risk, am glad this is happening.
ReplyDeleteAgree 100% with the above. About time someone came along and tried to make a go of it. Go-Ahead have had it all their own way for too long.
DeleteThe CMA argument about the Stagecoach takeover of First is simply smoke and mirrors. Someone in the loop of "affected" companies is having a bad day and thought they would make another complaint. This was upheld as well.
DeleteFirst forgot they were a bus company first and trains second.They put more effort on the trains , the other groups use different names for train companies not to mess their brand except Arriva Wales.Get back to basics invest nationally not in Manchester and Leeds only.
DeleteStagecoach have secret shoppers on first buses and you as an employee think that's good?? I'd be pretty worried myself!!!
DeleteI would only worry if there were something to hide. I am disabled (in a wheelchair), but use buses in Plymouth from time to time - particularly the Park and Ride. I have, without exception, found the First drivers to be friendly, helpful and understanding - and have formed the opinion that First has excellent staff let down by indifferent management. Getting observers to ride on the buses of a company you are thinking of buying seems to me to be eminently sensible - I am sure they will have come away with a good impression. It is more than likely, anyway, that the purpose of the exercise would be to gain a general impression of the operation, rather that identifying drivers they would not want to employ.
DeleteDrivers can, anyway, find out easily enough what Stagecoach is like as an employer through their union - both Devon General and Western National drivers are in the RMT, ex-NUR, from the days when the companies had railway involvement. Citybus drivers, on the other hand, are in Unite, ex-TGWU - although I do not know if these distinctions are still universal.
Stagecoach put secret shoppers on their services so they know what's good and what needs tackling. It's about giving passengers what they want and ensuring the long term future of the business. Is that not a good thing for both passengers and staff?
DeleteIt would be more surprising if the the CMA didn't launch an investigation, it seems to be almost mandatory nowadays with Bus Companies.
ReplyDeleteFrom a purely personal viewpoint: - "First Out, Stagecoach in" - What's not to like?
I am assuming (hoping!) that First will no longer have any kind of presence in Plymouth - Is this correct??
OK it looks like Stagecoach will have to short-term hire some 'deckers from First but given that the change over is happening at a time when Double Deckers across the country are in maximum demand, due to Schools going back, this is probably unavoidable.
No sign yet on the VOSA website of Chelson Meadow being added to the Stagecoach operators licence.
First have also closed their depot in Newcastle Under Lyme and several of their routes have been dropped and mostly taken up by independent operator D & G. This is after timetable changes every few months which is irritating for passengers. Surely First are not getting out of the bus market?.
ReplyDeleteFirst Potteries had one big change and then a slight revision to make some improvements and corrections in the last two years.
ReplyDeleteThe depot closure was a leased site so they've consolidated on one site but not everything can fit in.
http://www.stokesentinel.co.uk/Potteries-confirms-fifth-shake-services-Stoke/story-27457374-detail/story.html claims five shake ups to the service in a year. Trouble is that passengers like to get used to a service running at set times to set places and may well find other ways to travel if the service keeps changing. And I would include improvements in this.
DeleteFirst are still loosing money nationally and appear to be selling the family silver left right and centre. share prices keep falling it wouldn't surprise me in the slightest if they don't go into administration
ReplyDeleteYour information is factually flawed.
DeleteSorry but that's factually incorrect. In fact, it's rubbish.
ReplyDeleteFirst made profits as a group and UK bus increased revenue and margin. They're not selling the family silver - Plymouth was a drain on things as a continual loss maker. The other depot closures - no different from Stagecoach pulling out of Cowdenbeath or Chorley or Brynmawr
They won't go into administration and I advise you look at the financial results in future
Oh, and the share price is about 25% higher than 3 months ago and about he same as a year ago
ReplyDelete