Virgin Group and Stagecoach PLC have welcomed the Department for Transport's decision to invite the partnership to bid for the InterCity East Coast rail franchise.
The InterCity East Coast franchise provides frequent services connecting London with Yorkshire, the North East and Scotland. The franchise is expected to run for a period of around 8 to 9 years, with the provision for an extension of up to two years at the discretion of the DfT. An announcement about the successful bidder is expected in autumn 2014, with the contract expected to start in February 2015.
Patrick McCall, Senior Partner, Virgin Group, said: "Innovation and customer service are key in all Virgin's activities. We're excited by the opportunity to use Virgin Trains' expertise in bidding for InterCity East Coast with our partners at Stagecoach.
Stagecoach Group Chief Executive Martin Griffiths said: "Stagecoach and our partners Virgin have played a leading role in transforming rail travel in Britain over the past two decades. We have a strong record of introducing new trains, maximising the benefit of infrastructure improvements and attracting growing numbers of passengers to the railway.
"InterCity East Coast is a key part of the UK's rail network and we have already started consulting with stakeholders along the route to understand their aspirations for the franchise. We believe our private sector expertise can deliver a better service to customers and an attractive deal for the taxpayer. We look forward to submitting an innovative and competitive bid in due course."
Stagecoach and Virgin have formed a new entity, Inter City Railways Limited ("ICRL"), to bid for the franchise. Stagecoach has a 90% shareholding in ICRL, with Virgin Group holding 10%