Stagecoach Takeover Bid

Stagecoach Takeover Bid by Adam Rosen last updated on June 29, 2022

It is the last try for National Express to acquire Stagecoach. Earlier, the attempt was gatecrashed as the DWS group made a cash offer of 595 million pounds.

The battle to best bid for the company has pitted the founders of Stagecoach against one another. Brother Brian Souter is supporting the proposal of National Express while his elder sister Dame Ann Gloag is arguing for the approach of DWS.

If believed to the analysts, the transport group's investors may support the cash offer of DWS as the German infrastructure company has been unanimously been backed by the board.

However, National Express has lately lashed out at the rival company in the bidding and labeled it as a private-equity vulture. During the COVID-19 pandemic more such private-equity takeovers were witnessed in the United Kingdom including Morrisons, Asda, Aggreko and AA.

According to its spokesman, a surge has been lately noticed that British firms are being acquired by private-equity companies and the combination of National Express and Stagecoach is a rare example revealed UK-listed firms may emerge as a global leader.

Meanwhile, DWS has rejected the private-equity branding claiming it is in fact an infrastructure fund and the investments include Kelda, which owns Yorkshire Water.

National Express is well-known for being a coach service provider for long-distance routes and it believes the swoop of DWS has undervalued the Stagecoach.

Its spokesman further said the acquisition may provide the shareholders of Stagecoach to take part in the industry's future as lately the government is putting efforts on bus travel.

Meanwhile, the siblings have distanced themselves from the Perth-based company in recent years even though the two own 15.5 percent and slightly less to 10.5 percent shares. They founded Stagecoach in 1980 and took advantage of Margaret Thatcher's deregulation in 1986. The company became the largest coach and bus service provider in the UK shortly and went public in 1993 by getting the stocks listed on the London Stock Exchange.

Stagecoach became the first operator to start a service when rail became private in the country. However, the company overstretched over time and now is taking the exit door from the sector. The total wealth of the founders is estimated to be around 650 million pounds.

Columbia Threadneedle, the largest shareholder of the company, has shown support for the DWS. It now seems the National Express may not succeed in acquiring Stagecoach as the investors are preferring cash offer of DWS.

However, some analysts believe the footprint of National Express in the country may likely act in support of it in taking over the Stagecoach.