East Coast line to be renationalised

LONDON (Reuters) - The East Coast main line rail franchise, which runs services from London to Edinburgh, will come under public ownership on November 13, the Department of Transport (DfT) said on Thursday.

The franchise, which will be handed back by British bus and rail operator National Express (LSE: NEX.L - news) after it ran up large losses on the route, will take place a month earlier than originally planned after the DfT issued a termination notice last night.

The DfT said the franchise would be run by its Directly Operated Railways (DOR) unit until a new operator was found but that no services or employees would be affected by the handover.

The franchise will be operated by the government until mid-2011 and any profit it makes will be returned to the public purse while it is in state hands, according to an internal government briefing seen by Reuters.

National Express took over the running of the East Coast franchise in 2007, and agreed to pay the government 1.4 billion pounds over seven years.

(Reporting by Rhys Jones; editing by Paul Sandle)