Page last updated at 11:03 GMT, Wednesday, 11 November 2009

Transport firm in 360m cash call

National Express train
The government will take over the East Coast rail route this week

Bus and rail operator National Express has said it plans to raise £360m from investors in order to cut its debts.

National Express said the rights issue would "significantly" cut its debt burden, which stood at £1.1bn at the end of September.

Last month, the company ended talks about a possible merger with rival transport firm Stagecoach.

The firm is due to hand back the running of the East Coast rail route to the government at the end of the week.

The government said in July that it would take over the route, which runs trains between London and Edinburgh, after ministers refused National Express's requests for its contract to be renegotiated.

The government has also threatened to take back National Express's other rail franchises - East Anglia and c2c.

However, National Express reiterated that it had taken legal advice, and said it considered it had grounds to challenge any attempt by the government to take these franchises away from it.

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