Good news folks:
http://www.stagecoachgroup.com/scg/media/press/pr2009/2009-07-29/
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THE potential takeover of National Express has taken a fresh twist as Stagecoach yesterday revealed it was in exclusive talks with the consortium that has made a bid approach for the beleaguered transport group.
The development followed Spain's Cosmen family and the CVC private equity group confirming last Friday that they had made an all-cash offer approach to the company.
Perth-based Stagecoach said its talks were about the "possible acquisition by StagADVERTISEMENT ecoach of certain businesses and assets" of National Express if the consortium bid was successful. But the Scottish firm did not rule out a full counter-bid, saying it was continuing "to consider all other options in relation to National Express".
Meanwhile, the target company said yesterday it was considering the consortium's proposal, which it said was subject to "a significant number of pre-conditions and assumptions" .
These include retention, following a change of control, of the group's profitable East Anglia and c2c rail franchises and the extension of the East Anglia franchise to 2014.
Among other conditions are the Cosmens and CVC receiving bank financing on appropriate terms and satisfactory completion of "extensive due diligence".
National Express, whose interim trading results are out this Thursday, said it would also seek to "clarify the status of Stagecoach's discussions with the consortium and the potential impact on the deliverability of the consortium's proposal".
The Cosmen family already sits on an 18.6 per cent stake in National Express, the holding acquired when they sold a Spanish bus business to the British company some years back.
It was unclear yesterday which National Express assets Stagecoach, which runs South West Trains, is most interested in. Most analysts believe the main attraction is National Express's bus operations in Dundee and the English Midlands, and the long-distance coach operations.
"National Express's long-distance coach operations are the biggest in the UK, from Land's End to John O'Groats. That might mesh very well with Stagecoach's Megabus operation if it could be got past the regulator," one source said.
Andrew Fitchie, an analyst at Collins Stewart, said Stagecoach would be interested in National Express's bus operations in North America and the UK.
"It would have no interest at all in UK rail – it has problems of its own there – or in Spain."
Aberdeen-based FirstGroup put National Express into takeover play with an approach in late June, but walked away after being rejected by National's board.
Industry sources said yesterday FirstGroup was likely to need a full bid on the table, rather than indicative proposals, before being allowed to re-enter the fray against the consortium and Stagecoach. There are currently no talks between it and National Express.
