National Express and Stagecoach Combination announced

The Boards of National Express and Stagecoach have announced that they believe the Combined Group proposal should go-ahead to bring the following benefits:

 Further build scale and relevance in an increasingly 'bus-friendly' UK market, supported by the £3 billion National Bus Strategy for England as well as measures in Scotland and Wales;

 Facilitate an acceleration of the expansion of National Express's growth businesses across the UK, such as commuter, shuttle, private hire coach and accessible transport, across Stagecoach's footprint, as well as deliver other growth and revenue synergies;

Expand across the UK's large urban areas, whilst continuing to enhance strong relationships with key public sector stakeholders and city partners who are aligned on the need for modal shift;

Implement industry-leading environmental and sustainability solutions at scale to deliver high quality, zero-emission public transport, driving customer demand and playing a critical role in delivering government priorities for cleaner, greener and more resilient economies;

Deliver significant operational efficiencies across the combined UK networks, with, for example, National Express Coach utilising Stagecoach's well-located depot network to run and maintain its coach operations; and bring the 'best of both' from the combined capabilities of two high quality operators with well-aligned values and collaborative cultures, whilst also delivering significant benefits to customers and passengers, across key aspects of the business including on-board technology and safety; scheduling, network and route planning; and congestion management.

In addition, the National Express Board is confident of the Combined Group realising significant growth and revenue synergies, including accelerating the expansion of National Express's growth businesses across the UK, as well as utilising the expanded UK bus footprint to optimise sales and marketing.

Commenting on the Combination, Ignacio Garat, Chief Executive Officer of National Express said: "The proposed combination of National Express and Stagecoach, and the unique strengths of both companies and their teams, will create a leading multi-modal passenger transport business in the UK, aiming to deliver superb services to customers and forging the way to a carbon free future with a new generation of zero-emission buses and coaches.

The combined group will also benefit from the significant growth and cost synergies and a stronger balance sheet to significantly accelerate growth investment across our diversified international portfolio, aiming to deliver attractive sustainable returns to shareholders."

Martin Griffiths, Chief Executive of Stagecoach said: "Our companies have a shared vision around helping to build more sustainable communities and secure a net zero future. We also both have a strong track record of investing in our people and in our services to deliver sector-leading customer service, operational excellence and great value travel.

This is an exciting opportunity to bring together two of the UK's iconic transport brands to create a strong, diverse business that is well-placed to grow the market for greener and smarter public transport for the benefit of all stakeholders."

Upon completion of the Combination, it is intended that

Ray O'Toole, Chairman of Stagecoach, will become Chairman of the Board of the Combined Group, leveraging his prior experience across both businesses, with Sir John Armitt CBE stepping down having been Chairman of National Express since February 2013.

Jorge Cosmen, Deputy Chairman of National Express, will become Deputy Chairman of the Board of the Combined Group.

           Ignacio Garat and Chris Davies, CEO and CFO respectively of National Express, will become CEO and CFO respectively of the Combined Group.

The Board of the Combined Group will comprise a combination of National Express and former Stagecoach directors, approximately in proportion to the expected pro forma ownership of the Combined Group.

Gregor Alexander and Lynne Weedall, currently independent non-executive directors of Stagecoach, will join the Board of the Combined Group and become chairs of the Combined Group's Audit Committee and Remuneration Committee respectively.

       
            Tom Stables, CEO of National Express UK and Germany, will become CEO of UK and Germany for the Combined Group.

            Carla Stockton-Jones, UK Managing Director of Stagecoach, will become the Managing Director of UK Bus for the Combined Group.

National Express and Stagecoach will seek approvals for the combination from its shareholders and the UK Competition and Markets Authority, meaning that completion of the deal is not expected until the end of 2022.

Stagecoach to sell Scottish Citylink stake and the retail and customer service activities of Megabus UK and Falcon

Stagecoach has announced that it has entered into agreements to sell the marketing, retail and customer service activities of three of its inter-city coach businesses to ComfortDelGro Corporation Limited ("CDG"), namely:

· Stagecoach's 35% interest in Scottish Citylink Coaches Limited, a joint venture between Stagecoach and CDG, which markets and retails inter-city coach services in Scotland and between Scotland and England ("Scottish Citylink");

· the UK Megabus business which markets and retails inter-city coach services in England and Wales ("Megabus UK"); and

· Falcon South-West, which markets and retails tickets for a single coach route between Plymouth, Bristol and Bristol Airport ("Falcon").

· The total proceeds for the Disposal are £8.75 million, which is expected to complete on February 28th 2022.

Martin Griffiths, Stagecoach Chief Executive, commented: "Stagecoach developed the Megabus brand in 2003, as we saw real potential in the long-distance inter-city coach market in the UK. In 2005, our belief in this market saw us create a joint venture with CDG to run the Scottish Citylink business and we further expanded our inter-city coach business with the development of our bespoke Falcon service in the South West of England serving Bristol Airport. Through this transaction, Stagecoach ensures that those business will continue to thrive under the ownership of the world renowned CDG brand".

In detail

Stagecoach, through its wholly owned subsidiary Stagecoach Bus Holdings Limited, announces the sale of the entirety of its 35% stake in Scottish Citylink to Braddell Limited, a wholly owned subsidiary of CDG, which owns the majority 65% stake in Scottish Citylink.

In addition, Stagecoach through its wholly owned subsidiaries: Stagecoach Services Limited, Stagecoach Bus Holdings Limited, Midland Red South Limited and Stagecoach Devon Limited announces the sale of the marketing, retail and customer services activities of its Megabus and Falcon inter-city coach businesses to Scottish Citylink, which will then be a wholly owned subsidiary of Braddell Limited.

Stagecoach will continue to provide sub-contracted bus and coach operational services to the inter-city coach operations which will now be owned by CDG.

The Disposal proactively addresses potential regulatory considerations in respect of the recommended combination with National Express Group plc.