Stagecoach, UK govt fail to agree new deal on South West trains

LONDON, July 7 (Reuters) - British transport company Stagecoach said the government would run a competitive process for the south west rail franchise after it failed to agree terms to continue running the service for another two years after 2017.

Stagecoach, which has operated trains on the line between London and towns in south west England since 1996, said on Tuesday it would bid for the new long-term franchise.

The government had planned to agree a direct award for the train line with Stagecoach until at least April 2019. Stagecoach's current contract expires in February 2017 but it will continue to operate South West Trains until August of that year. (Reporting by Sarah Young, Editing by Paul Sandle)