Chief executive Phil White told the Financial Times that he believed the bus and rail sector was ripe for consolidation.

He indicated that National Express would like to be involved in the process, which could feature any of the other four big players in the sector -- Arriva, FirstGroup, Go Ahead and Stagecoach.

However, a spokeswoman stressed that National Express was not actively searching for a merger partner and that consolidation had been an issue circling the transport sector for some time.

The National Express portfolio features nine out of the 25 rail franchises, including ScotRail, Midland Mainline and WAGN Railways.

Mr White considered Go Ahead as the least likely merger partner and added there remained the problem of sorting out "cultural differences" in the other three companies.

Weak share prices and rivalry between strong characters running the groups appeared to be a barrier to consolidation, the FT report added.

National, which employs 13,200 people in its UK train operations and 5,300 people in its UK bus arm, posted a 17% drop in operating profits last year.