KENT bus operator Arriva has expanded its European holdings with the acquisition of German bus company Sippel Group.

The Sippel Group is one of the Germany's largest privately owned bus operators, and was bought by Arriva for £15.4m.

Sippel's major activity is the operation of local public passenger transport as a sub-contractor to municipal clients. It also provides special scheduled services to private sector clients such as Frankfurt Airport.

It operates throughout the Rhine-Main area, including in and around the cities of Frankfurt, Mainz and Wiesbaden.

The German bus market, like the rail sector, is evolving towards competitive tendering. The Rhine-Main Public Transport Agency has already started the process of contracting out bus services and it is anticipated that it will progressively subject all regional routes to tendering over the next few years.

Arriva, which already has public transport operations in Denmark, Germany, Italy, the Netherlands, Portugal, Spain and Sweden, also owns German rail company Prignitzer Eisenbahn Gruppe.

In October 2004, the company acquired a 76.9 per cent stake (now 89.8 per cent) in Regentalbahn AG, who operate regional passenger rail services in the federal states of Bavaria, Thuringia and Saxony as well as joint services with the Swiss and Czech state railways.

Bob Davies, Arriva's chief executive, said: "The German public transport market is the largest in Europe, with the bus and rail sectors rapidly moving to a competitive tendering environment.

"This acquisition allows us to participate in future tenders for bus services in one of Germany's most important economic regions.

"Sippel has an excellent reputation for delivering high quality services to its customers and we look forward to working with the management and employees of this successful business to capitalise on further opportunities in this market."