HITACHI Rail has agreed to sell several European signalling businesses. The value of deal has not been disclosed. However, it is a necessary precondition for the completion of the company’s €1.66bn purchase of Thales Ground Transportation Systems (GTS), first announced in August 2021.

Italian-based MerMec has agreed to buy Hitachi Rail’s existing signalling business units in Germany and Britain, as well as the company’s mainline signalling business in France (formerly CSEE). In total around 550 employees will transfer to MerMec.

Hitachi Rail has sought, and received, clearance from 13 competition authorities for its proposed takeover of Thales. Most recently, the European Commission (EC) gave its approval in October after Hitachi agreed to divest signalling platforms in France and Germany.

This followed an EC investigation that found that the deal as originally proposed would have reduced competition and led to higher prices and less innovation in the mainline signalling market.

Hitachi had already offered to divest its British signalling business unit after Britain’s Competition and Markets Authority (CMA) raised similar concerns relating to reduced competition.

No timescale for the divestment has been announced.

“Today we have achieved a major milestone towards the final acquisition of Thales GTS,” says Hitachi Rail group CEO Mr Giuseppe Marino, “which is a key part of our growth strategy.”

“The agreement follows a key commitment to European and UK regulators… This solution also will grant the divested business a long-term future.”

Hitachi says that it will retain its other operations in Britain, France and Germany, including its centre for CBTC technology in France and rolling stock and maintenance business in Britain.

MerMec formed a joint venture with Stadler in 2018 under the AngelStar brand to develop signalling systems. In November two DB Cargo class 185.2 locomotives were successfully retrofitted with the company's Guardia Baseline 3.4.0 ETCS automatic train protection system.