LONDON/FRANKFURT (Reuters) - Deutsche Bahn sealed a takeover of Britain's Arriva yesterday and predicted a Europe-wide transport sector consolidation wave would follow.

Deutsche Bahn chief executive Ruediger Grube said the combined group would become one of just a few strong players in the rail, bus and logistics industries as Bahn expands internationally to take advantage of a more liberalised transport market in Europe.

"We intend to be the drivers and not the driven," Mr. Grube said, adding that the absence of synergies showed the merger was aimed at growth, not cost cuts.

The combined entity will be Europe's No.1 passenger carrier, carrying over three billion bus and rail journeys per year, overtaking France's SNCF, which had previously discussed the possibility of tie-up with Arriva.

Grube predicted there would be "five or six" big pan-European transport groups within 10 years, with state-backed groups playing a key role, although he gave no specific detail on which countries or companies could be next in line.

Arriva's shares were 0.4 percent up by 1245 GMT while the possibility of consolidation sent shares in rival UK transport groups higher. Stagecoach rose 2.4 percent, while National Express and Go-Ahead Group were 1.4 percent up.

Deutsche Bahn, already Europe's biggest transport group by revenue, hopes transport and logistics growth will boost sales after the recession hit turnover last year.

Northeast England-based Arriva, Britain's third-biggest bus company, also runs franchises and other services in 12 European countries, making it one of the continent's few listed transport operators with a wide international footprint.

Grube said Bahn was determined to buy Arriva but was not prepared to enter a bidding war should another suitor emerge.

Bahn's offer values the share capital of Arriva at about £1.59 billion ($2.4 billion), but including Arriva's debt, which stood at £852.1 million at the end of 2009, the value of the deal reaches closer to £2.5 billion.

Bahn will likely issue a bond in the coming months to finance the deal, which should close in August.

Citi analyst Roger Elliott said Deutsche had paid a "very full price" but played down the chances of consolidation wave.

"We see echoes of the pre-IPO acquisition spree of Deutsche Post in the late 1990s, similarly sanctioned by the sole state shareholder, to diversify away from a narrow core business increasingly exposed to competition," he said in a note.

Mr. Elliott also said that unlike rivals, Deutsche Bahn had largely completed the global expansion of its freight business and that broadening its exposure to the European passenger network ahead of liberalisation therefore made sense.

Mr. Grube said Bahn would have to sell Arriva's German rail activities to meet EU competition rules.

The deal gives Arriva shareholders, who will be entitled to a final dividend of 18.8 pence per share, 775 pence in cash for each Arriva share they own.

Mr. Grube has fended off criticism from politicians over the deal, which is the most expensive in the company's history, and said the deal would not derail its plans to invest 41 billion euros ($55 billion) in its German operations over the next five years.