Virgin loses it

We're at a bit of a loss as to how Arriva is even allowed to bid for rail franchises, much less take the Virgin cross-country services. Arriva had the Merseyrail contract taken off it in 2002 when its bid for an extension of the franchise didn't even make the shortlist; in the same year it lost a franchise in the North East. If you're considered to have made such a botch of actually running services they're taken off you and given to other people, why would you even be invited to try your hand again?