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    SGC   GB00B6YTLS95

STAGECOACH GROUP PLC

(SGC)
  Report
Delayed Quote. Delayed London Stock Exchange - 12/08 11:35:29 am
76.5 GBX   -0.20%
11:15aMiscellaneous
AQ
10:23aUK travel, leisure stocks slip on reports of tougher COVID-19 curbs
RE
03:08aUK's Stagecoach profit surges as public transport usage picks up
RE
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National Express in talks for all-share takeover of Stagecoach

09/21/2021 | 05:47am EST
The spread of the coronavirus disease (COVID-19) in South Shields

LONDON (Reuters) -British transport company National Express is in talks to acquire rival operator Stagecoach Group in an all-share deal, offering scope for cost savings and underpinning their recovery from COVID-19.

The tie-up, which would value Stagecoach at about 445 million pounds ($609 million), comes as government support to help the companies get through the pandemic is due to expire.

National Express has bus and coach operations in Spain and Britain, runs school buses in the United States, and has a German rail contract.

Stagecoach, solely focused on Britain, is the country's biggest bus and coach operator. The company was founded by Brian Souter and his sister Ann Gloag in Perth in 1980, starting out with just two buses bought with their father's redundancy money.

They still own stakes in the company - Souter has about 14.55% and Gloag around 10.47%, based on Refinitiv data.

Under the terms of the potential takeover, Stagecoach shareholders would receive 0.36 new National Express shares for each Stagecoach share, giving them a 25% stake in the merged group.

That represents an 18% premium on the closing price of Stagecoach's shares on Monday.

Stagecoach's stock jumped 20% to 81 pence in early trading on Tuesday. National Express rose 7% to 239 pence per share, giving it a market value of 1.48 billion pounds.

During the pandemic, both Stagecoach and National Express received government support to keep services running when passenger numbers were down, but that funding will end in the coming months.

Transport usage is starting to recover as workers return to offices, but is still not near its pre-pandemic levels.

The companies said the tie-up would make pre-tax cost savings of 35 million pounds per year through efficiencies such as National Express utilising Stagecoach's depots for its coach operations.

Stagecoach runs the megabus service, which like National Express, operates coach services between British cities.

Citi analysts said the deal would be positive for the transport sector. Rival UK operators FirstGroup and Go-Ahead also rose around 3% on news of the potential deal.

"We have argued for consolidation in the UK Public Transport given the structural challenges facing the industry, i.e. the pandemic impact on passenger volume and capex headwinds related to the adoption of environmentally-friendly vehicles," Citi said in a note.

The companies said that discussions and due diligence remained ongoing and there could be no certainty of a formal offer.

Should a deal go ahead, Stagecoach's chairman Ray O'Toole, a former chief operating officer at National Express, would become chair of the combined group, while National Express chief executive Ignacio Garat would continue as CEO of the merged entity. ($1 = 0.7310 pounds)

(Reporting by Sarah Young; Editing by Kate Holton, Michael Holden and Jane Merriman)

By Sarah Young


ę Reuters 2021
All news about STAGECOACH GROUP PLC
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10:23aUK travel, leisure stocks slip on reports of tougher COVID-19 curbs
RE
03:08aUK's Stagecoach profit surges as public transport usage picks up
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02:19aStagecoach's Fiscal H1 Profit Climbs As Passenger Volumes Rebound
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02:05aEarnings Flash (SGC.L) STAGECOACH GROUP Reports Fiscal H1 EPS GBX1.90
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Analyst Recommendations on STAGECOACH GROUP PLC
More recommendations
Financials
Sales 2022 1 114 M 1 472 M 1 472 M
Net income 2022 22,8 M 30,1 M 30,1 M
Net Debt 2022 330 M 436 M 436 M
P/E ratio 2022 19,1x
Yield 2022 2,78%
Capitalization 421 M 558 M 557 M
EV / Sales 2022 0,67x
EV / Sales 2023 0,56x
Nbr of Employees 24 135
Free-Float 65,1%
Chart STAGECOACH GROUP PLC
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Stagecoach Group plc Technical Analysis Chart | SGC | GB00B6YTLS95 | MarketScreener
Technical analysis trends STAGECOACH GROUP PLC
Short TermMid-TermLong Term
TrendsNeutralNeutralNeutral
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus BUY
Number of Analysts 8
Last Close Price 76,50 GBX
Average target price 109,63 GBX
Spread / Average Target 43,3%
EPS Revisions
Managers and Directors
Martin Andrew Griffiths Chief Executive Officer & Executive Director
Ross John Paterson Finance Director & Executive Director
Raymond O'Toole Independent Chairman
Arnold Mark Threapleton Chief Operating Officer
Gregor Alexander Senior Independent Non-Executive Director
Sector and Competitors