National Express in £400m talks to buy rival Stagecoach
PUBLIC transport giant National Express is in talks to snap up rival Stagecoach in a deal worth more than £400million.
Although the agreement is being described as a merger, National Express shareholders would end up owning 75 per cent of the combined company.
Birmingham-based National Express said that acquiring the firm would deliver “significant” operational efficiencies and growth opportunities in the UK and overseas, particularly in the US.
Susannah Streeter, a Hargreaves Lansdown analyst, said: “Given that the pandemic blew out the tyres of their business models and it’s been such a slow road back, it comes as little surprise that rivals National Express and Stagecoach [are going to] shoulder the recovery together.”
A merger of the companies would create a combined fleet of 36,000 coaches and buses.
Elsewhere, Ladbrokes and Coral owner Entain looks set to become the focus of an intense bidding war.
It has received a £14.6billion takeover offer from US fantasy sports giant DraftKings, which is understood to value Entain at 2,500p per share.
Its proposed offer is believed to be made up of cash and shares and it has until October 19 to lodge it formally.
Prior to news of the bid becoming public, Entain shares traded at 1,892.5p. In January, Entain rejected an £8bn offer from US casinos giant MGM Resorts, with which it has a joint venture. Under market rules MGM was banned from making another approach for six months, though that lapsed in July.
With US companies looking to expand globally and tap into British expertise, MGM may lodge a competing offer.
AJ Bell investment director Russ Mould said: “It is possible [that MGM makes an offer for Entain], especially given the scramble going on in the US market.”
This month William Hill’s UK and European business was sold to 888 for £2.2bn, after the group was acquired by Las Vegas casino giant Caesars in April.