It’s time to sell FirstGroup

To win the West Coast rail franchise, FirstGroup had to pay a staggering amount of money. The costs of getting it wrong could be very high indeed - and it doesn't look like the numbers stack up, says Phil Oakley.

If you want to run an inter-city rail franchise in Britain one thing is abundantly clear you need to be prepared to offer the government lots of money.

That's what FirstGroup (FGP) has agreed to do. In return for running the West Coast rail franchise - which links London to places such as Birmingham, Manchester and Glasgow - for the next 13 years it has signed up to pay eye-watering amounts of cash to the Treasury.

Subscribe to MoneyWeek

Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE

Get 6 issues free
https://cdn.mos.cms.futurecdn.net/flexiimages/mw70aro6gl1676370748.jpg

Sign up to Money Morning

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Sign up

Phil spent 13 years as an investment analyst for both stockbroking and fund management companies.

 

After graduating with a MSc in International Banking, Economics & Finance from Liverpool Business School in 1996, Phil went to work for BWD Rensburg, a Liverpool based investment manager. In 2001, he joined ABN AMRO as a transport analyst. After a brief spell as a food retail analyst, he spent five years with ABN's very successful UK Smaller Companies team where he covered engineering, transport and support services stocks.

 

In 2007, Phil joined Halbis Capital Management as a European equities analyst. He began writing for MoneyWeek in 2010.