Bus operator gets ticket to run South-West trains.

Transport company Stagecoach has been awarded the South Western rail franchise with the promise of a better service for passengers.

The company, which operates bus services across the North-East, already runs the existing South-West and Isle of Wight Island Line franchises, which will be joined to make up the new franchise in February 2007.

As well as being committed to improving services, Stagecoach will have to pay the Government back pounds 1.19bn in premiums over the 10-year life of the franchise.

Services in the new franchise include those between London's Waterloo station and Southampton, Portsmouth, Exeter, Bristol, Brighton and Plymouth.

Improvements to services will include more seats in the rush-hour, longer trains, extra morning peak services between London and Basingstoke, increased security, more flexible ticketing and major station enhancements.

Stagecoach Group chief executive Brian Souter said: "We are delighted to be entrusted by the Government with the contract to run the UK's most important rail franchise.

"We believe there is a huge opportunity to attract new passengers to rail travel and improve services for existing customers, and our exciting ideas for the franchise will unlock the full potential of the network."