A consortium including the UK arm of French railway SNCF and support services group Amey has won the contract to run London's Docklands Light Railway, beating off competition from support services group Serco and transport group Stagecoach.

Transport for London (TfL) said it had chosen Keolis Amey Docklands (KAD) to run the light rail network in east London from December until 2021.

TfL said it would work with KAD to ensure good interchanges between the DLR and London's new Crossrail service, which should open in about three years' time.

TfL's Managing Director of London Underground and Rail, Mike Brown, said: "The decision to appoint Keolis Amey Docklands was reached after a thorough and competitive procurement process, which will ensure the DLR continues to deliver an ever-improving high quality, value-for-money service."

The announcement will come as bad news for rival bidders Serco and Stagecoach.

Serco, which has been embroiled in a controversy over prisoner tagging in the UK, said the DLR deal was worth about £90m in revenue to it in 2013, or 2% of the group's overall revenues, at a margin that it said was "significantly below the average level the group achieves on its contracts".

David Stretch, Managing Director of Serco's Transport business, said the company was disappointed by its failure to renew the contract.

But he pointed out that Serco, which also runs regional rail services in northern England, has just won a 15-year deal to run sleeper train services between London and Scotland.

"We remain excited by the opportunities we see to transform services for passengers in the transport market," he said.

A Stagecoach spokesman said: "We are disappointed not to have won the DLR franchise. We submitted a strong, customer-focused bid, which we believe delivered good value to the taxpayer.

"We always look to submit bids we feel are financially and operationally deliverable. As a matter of course, we will seek feedback from TfL on our bid as part of our evaluation of the outcome."

PW

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