Coach operator National Express is in talks to buy the Stagecoach Group in an all-share arrangement.
The £445m deal would mean 75% ownership for National Express and 25% of the merged company for shareholders in Stagecoach, which operates services across the country including in Kent.
The bus company was founded in 1980 by Brian Souter and his sister Ann Gloag, who bought Manston airport in 2013 and shut it a year later, selling a majority stake to businessmen Trevor Cartner and Chris Musgrave who formed Stone Hill Park.
Ann and Brian started the Stagecoach company with two buses bought from their father’s redundancy package.
The companies said the latest deal would mean savings of £35 million per year through efficiencies.
Discussions and due diligence are ongoing. Stagecoach employs 24000 people in the UK and National Express employs 48000.
A statement from Stagecoach says: “The Board of Stagecoach Group plc confirms that it is in discussions with National Express Group PLC (“National Express”) in relation to a possible all-share combination.
“Under the terms, it is expected that Stagecoach shareholders would receive 0.36 new National Express ordinary shares for each Stagecoach ordinary share, resulting in them owning approximately 25 per cent of the Combined Group.
“The Boards of Stagecoach and National Express believe that the Potential Combination would be a strategically compelling proposition with the potential to realise significant growth and cost synergies, as well as delivering strong value creation for both sets of shareholders.
“It is expected that (it) would provide an opportunity to:
– Deliver significant operational efficiencies across the combined networks, with, for example, National Express Coach utilising Stagecoach’s well located depot network to run and maintain its coach operations;
– Bring the ‘best of both’ from the combined operational capabilities of both businesses, whilst also delivering significant benefits to customers and passengers;
– Accelerate the expansion of National Express’ growth businesses, such as private hire coach, corporate shuttle and accessible transport, across Stagecoach’s UK footprint, as well as deliver other growth and revenue synergies; and
– Maintain strong relationships with key public sector stakeholders, best positioning the Combined Group in an evolving industry landscape, with quality public transport playing a critical role in delivering government priorities for cleaner, greener and more resilient economies.”
National Express is required to either announce a firm intention to make an offer for Stagecoach or announce that it does not intend to make the offer by, 5pm on 19 October.
