Serco Group plc has agreed the sale of its Great Southern Rail (GSR) business to Australian private equity firm Allegro Funds for an enterprise value and cash consideration of £2.5m (EUR 3.4m). The transaction is part of the disposal programme of businesses identified as not being core to Serco’s future strategy, as announced initially in November 2014. The sale is expected to complete in the coming months, subject to customary closing conditions and approvals.
GSR offers award-winning multi-day tourist rail experiences traversing Australia’s unique landscape, including The Ghan, The Indian Pacific and The Overland. The Strategy Review undertaken in 2014 identified that the business was not aligned with Serco’s future strategy given GSR’s historical lack of profitability, as well as limited synergies with the rest of Serco’s transport portfolio.
For the year to 31 December 2014, the financial result of the business was revenue of £58m (EUR 79m) and a pre-exceptional operating loss of £3m (EUR 4m).
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