(Bloomberg) -- Apollo Global Management Inc. and Carlyle Group LP are the two remaining bidders competing to acquire Deutsche Bahn AG’s European transport business Arriva, people familiar with the matter said.
The buyout firms are proceeding in the final stages to make binding bids for the U.K.-based unit, which could be d at about 3 billion euros ($3.3 billion), the people said. Deutsche Bahn is exploring all options for Arriva and continues to also weigh an initial public offering of the business, the people said, asking not to be identified as the matter is private.
Deutsche Bahn, Germany’s state-owned rail operator, announced plans in March to divest Arriva to help pay off debt and is exploring a sale as well as an IPO in Amsterdam. Arriva employs more than 53,000 people in 14 European countries for its bus and rail operations and Deutsche Bahn acquired the company for 1.6 billion pounds ($1.9 billion) in 2010.
While Apollo and Carlyle are the only remaining bidders pursuing Arriva’s entire business, other suitors may still be interested in parts of its operations, according to the people. No final decisions have been made, and Deutsche Bahn could still opt for a different buyer or decide to list the unit, the people said.
Representatives for Deutsche Bahn, Apollo and Carlyle declined to comment.
Arriva has benefited from acquisitions and higher demand for bus and rail from Hungary in the east to Spain in the south. That has helped offset challenges for its U.K. rail business, which faces a political and client backlash, as well as uncertainties amid negotiations for the U.K. to exit the European Union.
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