The Government has announced the winner of the competition to run a new mega-large rail franchise that includes the £6.5 billion Thameslink project.

The new Thameslink, Southern and Great Northern (TSGN) franchise will be run by the Go-Ahead Group company Govia, with rival company FirstGroup missing out.

FirstGroup had been running a section of the new franchise under the First Capital Connect (FCC) banner since 2006, but FCC will disappear when the new seven-year TSGN franchise starts in September 2014.

While Go-Ahead celebrated today, FirstGroup chiefs expressed their disappointment at losing out on a franchise which, in terms of passengers, is the biggest ever awarded.

The TSGN franchise will replace the existing Thameslink and Great Northern franchise (operated as First Capital Connect) from September 14 2014 and will include the South Central franchise (operated as Southern and Gatwick Express) when it expires on July 26 2015.

A small number of services and stations will also transfer from the South Eastern franchise by December 21 2014. The current franchises provide around 273 million passenger journeys annually.

The Department for Transport said today that would open up new routes across London and improving services to scores of destinations, including Brighton, King's Lynn, Peterborough, Cambridge, Bedford, Luton and Gatwick airports and Moorgate.

Nearly 1,400 new electric carriages will be rolled out across the new franchise, providing 50% more capacity and 10,000 extra seats every week day into central London during the morning peak by the end of 2018, delivering quicker, cleaner and more reliable journeys for passengers and businesses.

In addition, the new franchise will see millions invested in improving stations and staffing, a simplified ticketing structure and tough new targets for Govia to improve punctuality by reducing delays by around a fifth, and improve cleanliness.

Rail Minister Stephen Hammond said: "A world class railway is a vital part of our long-term economic plan. New state-of-the-art trains, more seats, better connections and improved stations will transform travel across London and the South East. That's great news for businesses and the hundreds of thousands of passengers who use these vital services every day."

The TSGN franchise will play a crucial role in delivering the Government's Thameslink Programme - a major programme of infrastructure work that is helping create 8,000 jobs and will allow 24 trains per hour to travel in each direction from Blackfriars to St Pancras.

New tunnels will link Peterborough and Cambridge to the existing Thameslink route, providing easy access across London via St Pancras to Gatwick and Brighton.

The franchise will introduce 1,140 new carriages - already under construction - on the Thameslink network, improving services to scores of destinations, including the introduction of new cross capital services and a connection at Farringdon to London's newest railway, Crossrail.

In addition, Govia will order a new fleet of 108 carriages for the Gatwick Express service, replacing the current 25-year-old trains with a fleet better suited to the needs of airport passengers. It will also secure 150 new carriages to replace the 40-year-old trains currently operating on the route between Moorgate, north London and Hertfordshire.

David Brown, group chief executive of the Go-Ahead Group said: "This award is testimony to the experience of our people of working in partnership with the DfT, Network Rail and other industry stakeholders and in delivering major integration projects and change programmes.

"Our bid for the franchise was focused on improving customers' experience and includes two new train fleets for Gatwick Express and Moorgate services, in addition to overseeing the introduction of the Thameslink trains already ordered, as well as delivering improvements at stations.

"I'm looking forward to working with existing colleagues and welcoming new staff and together delivering this transformational franchise."