A MERGER between two Hampshire bus companies has collapsed.
As reported by the Daily Echo, a deal had been signed between Black Velvet and Xelabus but the latter had a “change of heart” according to Velvet's boss.
Phil Stockley, managing director of Velvet, said Xelabus had paid compensation to exit the legally binding agreement just one day after making the deal.
He said: “The buyers changed their mind some time after the deal had been signed off and legally agreed. For legal reasons I cannot go into what happened but after further discussions we reached a settlement with them to release them from the contract.
“We will now carry on as normal under my ownership.”
Mr Stockley added he is not looking to sell the company but that the offer from Xelabus was a good deal at the time.
He said: “We were not actively looking to sell before and are not doing so now. The approach was out of the blue and after we looked at what they had to say they made what we felt was a reasonable offer.
“But it was never on our agenda to sell the company and we will now get back to what we are most interested in - providing good quality transport for our customers.”
Philip Blair, who owns Xelabus, confirmed the deal collapsed after a “change of heart” on his part but refused to comment further.
He said: “I'm not prepared to make any comment about the deal. It's quite correct to call it a change of heart but I have no further comment.”
Velvet was founded in November 2007 and is well known throughout the city for its fleet of purple buses.
It runs more than 15 services between Southampton, Eastleigh and Winchester.
Meanwhile Xelabus provides a series of specialist school and shopper services along with five commercial routes in Eastleigh and Chandler's Ford.