A consortium of United Group, Leighton Holdings subsidiary John Holland and Hong Kong’s Mass Transit Railway Corporation has won an eight-year contract to operate Melbourne’s passenger train franchise.

The consortium, Metro Trains Melbourne (MTM), will focus on safety and reliability of the rail service as part of the deal signed with the Victoria transport department.

Guidelines include a 24% reduction in cancellations in the team’s first year of operation and a 10% increase in the rail service’s punctuality.

The contract begins from 30 November 2009 for an initial eight-year period with an option for a seven-year extension.

John Holland and United group each estimate the revenue from their share in MTM at $162m each year.

The team will also revamp the air-conditioning of all the 93 six-carriage Comeng trains.

The consortium beat bids from Veolia Transport and a joint venture of Keolis and Downer EDI for the contract.