A bus company is in talks to buy out a competitor in a deal that could affect 70 workers.

Go-Ahead, which owns the Brighton and Hove Bus company, is in discussions about taking over services run by Stagecoach in the Lewes area.

Stagecoach has 70 employees and 25 vehicles working out of its Lewes depot.

The firm has promised that staff will be consulted before any decision is taken.

Steve Stewart, spokesman for Stagecoach, said: "We are in discussions with Go-Ahead about the potential sale of our Lewes operations but the discussions have not led to any final agreement."

If the deal goes ahead, the firm's 70 workers' conditions of employment would be protected by the Transfer of Undertakings (Protection of Employment) Regulations 1981 (TUPE).

Mr Stewart said: "We have kept our employees up to date. Discussions are ongoing."

Following a takeover, redundancies can only be made by following the correct procedures of communication with individual workers and with union or employee representatives.

Roger French, managing director of the Brighton and Hove Bus and Coach Company, said he could not yet comment on the process. He said: "It is quite an early stage."

The Brighton and Hove Bus and Coach Company employs more than 1,000 people.

It is currently refurbishing its depot in Lewes Road, Brighton at a cost of £1.25 million.

Earlier this year its parent company Go-Ahead, which operates bus services in London and Oxford as well as rail services, recorded a pre-tax profit of £49.6 million for last six months of 2004, compared to £47 million the year before. Turnover rose from £633.8 million to £637.9 million.

Stagecoach runs bus services in the Lewes area to Tunbridge Wells, Uckfield, Ringmer, Brighton, Landport Estate and Halland.

The Perth-based bus and rail firm is one of the largest bus operators in the UK with a fleet of about 7,000 buses and coaches serving more than 100 towns and cities.

Results recorded at the end of last year showed a ten per cent rise in bus revenues with passenger volumes up 1.3 per cent.

Stagecoach recently announced it was to spend just under £20 million on a new fleet of 169 buses, its second major purchase this year. In March it ordered 340 new vehicles for £35 million.