Arriva, a subsidiary of German Rail (DB), is demanding more information on how the DfT assessed the bids after Abellio secured the contract in April and all other operators were disqualified. The operator filed the legal claim at Britain’s High Court last week.

The DfT awarded the contract after disqualifying both Arriva and Stagecoach, stating that the bids were “non-compliant.”

In launching its legal action, Stagecoach cited the bidders’ specific failure to accept specific pensions risks, which it says the DfT expects operators to bear on the East Midlands, South Eastern and West Coast Partnership franchises. The company says the full extent of the risks is unknown but expects it to be in excess of £1bn.

Stagecoach chief executive Mr Martin Griffiths said the firm had “no choice” but to launch legal action to ensure proper public scrutiny.

The DfT said it does not comment on legal proceedings.