Serco to shake up Africa, Middle East and Asia business

18th Jun 2014 07:43

Troubled support services group Serco is launching a shake-up of its Africa, Middle East, Asia and Australasia (AMEAA) business and pledged to go solo in a bid for a UK rail franchise.Serco, which has been hit by a controversy over prisoner tagging in the UK, plans to close a regional office in Hong Kong and to streamline its management reporting structure to cut costs.It expects to finish the full transition by the end of September. AMEAA Chief Executive David Campbell, who has already extended his service beyond his planned retirement date, will retire this year after more than 20 years.Serco's Chief Executive Rupert Soames said: "This change will simplify the management structure, reduce cost and give our important growth markets in the Middle East and Australia greater visibility."Serco, which provides defence, education and health services and runs transport including London's Docklands Light Railway, also said it had decided to bid for the new Northern Rail franchise alone rather than in partnership with the UK arm of Dutch railways, Abellio.Serco and Abellio signed a 22-month interim franchise agreement in March to continue running the Northern Rail service for the UK Department for Transport until February 2016, when the new franchise starts."Given the individual strengths of each company's rail credentials, Serco and Abellio have agreed they will pursue separate paths in respect of the new Northern Rail franchise," Serco said in a statement.The Merseyrail joint venture, which runs until 2028, is unaffected by the decision.PW