National Express will buy Stagecoach in a share-all deal that will bring together two of the UK’s biggest public transport operators, as the sector rebuilds from the pandemic.
Stagecoach shareholders will receive 0.36 new National Express shares for each Stagecoach share, giving them approximately 25% of the combined company stock. That would value the Perth-based group at around £468 million, based on Tuesday’s National Express share price.
Shares of Stagecoach jumped 6.8% following the announcement but were still half their pre-pandemic levels.
The combined company will be the UK’s largest trucking provider with 40,000 vehicles and a workforce of around 70,000. The deal combines the UK’s largest fleet and National Express’ extensive international operations with the operator of more than 25% of the country’s buses.
Ignacio Garat, chief executive of National Express, says the deal will “create a leading multimodal passenger transport business in the UK”.
The consolidation of the UK bus and coach sectors comes after a difficult period for operators after the coronavirus pandemic hit revenue and the sector will face an end. state aid early next year. Meanwhile, transport providers are increasing their investment in expensive hydrogen and electric buses.
The two companies expect cost savings of £45 million, up from previous expectations of £35 million when the National Express approach was first announced in September.
