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Celine Sun

A French multinational is taking over the running of Hong Kong's famed tramways after buying a 50 per cent stake in the business from the  Wharf conglomerate.
Announcing the deal yesterday, the two companies said they aimed to 'bring new impetus to keep the system on track well [into its]  second century of operation'. They said existing services would continue.
 Under the arrangement - which is certain to come under scrutiny from environmentalists and heritage activists - Bruno Charrade, head of operations for Veolia  Transport China, a subsidiary of Veolia Environnement, will replace  Wharf Transport Investment director Frankie Yick Chi-ming as managing director of Hongkong Tramways.
Veolia Transport - formerly Connex - which operates transport systems around the world, including tramways in 10 European countries, did not say how much it paid for its stake but did say it was 'far less than 100 million euros (HK$1.04 billion)'.
Mr Charrade said the company understood the trams were a part of  Hong Kong's history and a unique part of its  cultural heritage.
'We are committed to protecting and preserving it,' he said. Veolia would seek to improve the company's  management and technical services and the safety, efficiency and quality of its services.
'We will study our passengers first before analysing the sustainability of the existing system,' he said. 
But he committed to 'continuity of existing services' and said there were no plans to raise fares, cut staff or restructure the company. 
A spokesman for the Transport and Housing Bureau said the government had stressed to both Wharf and Veolia the importance of preserving the tradition of the  service, including the trams' design.
'Veolia has assured us that it is fully committed to preserving the trams in Hong Kong,' he said. 
Veolia operates buses, trains, trams and light rail services serving 40 large cities in more than two dozen countries. It sees its acquisition of a stake in Hongkong Tramways as part of its long-term China strategy. The company  operates bus joint ventures in Anhui province and Nanjing.
'You can see that many countries which abandoned tramways three decades ago are resuming the operation of this traffic tool for its nice look and [environment-friendliness],'  Mr Charrade said. 
'Hong Kong will be a very good base for us to develop in China, where environment-friendly traffic solutions are in great demand.'
The deal has been more than two years in the making.
'A number of buyers approached us during the past two years. We think Veolia is the best partner considering its knowledge and expertise in this area,' Mr Yick said. 
The tram company made a profit of around HK$2 million a year between 1996 and 2006, but earnings surged to more than HK$10 million in 2007 and more than HK$30 million in 2008 thanks to a revamp  of its advertisement services. 
'Our goal [in co-operating with Veolia] is to bring the tram services to a new level,' Mr Yick said. 
 Andrew Cheng Kar-foo, deputy chairman of the Legislative Council's transport panel, hoped fares would not rise if services were added.  
'Despite the change of ownership,  we hope the trams will remain Hongkongers' trams,'  he said.



French giant buys control  of city's trams