I don't think they're anywhere near that at the moment. We're six weeks into the largest and most complex of the tranches (which is why it was kept 'til the end). Metroline/CDG is generally well regarded as a London contractor. They submitted the best offers for the packages that they won. Had TfGM wanted to de-risk the process, they could've had a process where there was a cap on the amount of work a single party could have won.
As for handing franchises back, I'd be interested to know what the contract states about that. Usually, if you hand back a publicly procured contract (and unless you can prove that there was something fundamentally wrong with the procurement exercise), then the business can be liable for the costs of a new procurement exercise. Again, depending what the contract says, there might be the ability to sub-contract a depot but can you imagine what a rival would charge for that?
That's not surprising if 95% of your business is London based, you're going to be massively influenced in your thinking. Then again, wasn't Andy Burnham selling this on it delivering "London style" bus benefits? I'm sure that they expected a bit of churn in the workforce but clearly not to this extent.
At the end of the day, our concern should be with the passengers. Not nice waiting for buses that don't arrive, impacting on people's work and home lives, and especially at this time of year.