- Bus operator in the crosshairs of two potential buyers
- Minded to recommend a deal if firm offer forthcoming
- Last week FirstGroup rejected bid
London’s largest double-decker bus operator Go-Ahead (GOG) has attracted takeover interest from two potential buyers as investors bet on a revival in the UK transport industry.
Go-Ahead said on Monday (13 June) that it has received two takeover proposals at terms it ‘would be minded to recommend’ should a firm offer materialise, sending the stock soaring nearly 20% to £14.39.
The Newcastle, England-based public transport operator said it has received a takeover proposal from Sydney-listed transport Kelsian Group and another from a consortium consisting of Kinetic and Globalvia Inversiones. Kinetic is a bus operator in Australia and New Zealand, while Globalvia is a Madrid-based transport infrastructure firm.
Kelsian operates transport services in the UK, Singapore and Australia. In May, Kelsian sold its Lea Interchange depot in east London to Stagecoach (SGE) for £20 million. Both approaches were unsolicited.
BOARD BACKS POTENTIAL BUYOUT
‘The most recent revised proposals received from each of Kelsian and the consortium are both at a level which, should a firm offer be made, the board of Go-Ahead would be minded to recommend such a firm offer to Go-Ahead shareholders, subject to the agreement of other customary terms and conditions. Accordingly, both parties have been given access to undertake confirmatory due diligence,’ Go-Ahead said.
The UK transport sector has been the target of takeover interest of late. In May, Pan-European Infrastructure III SCSp, an infrastructure fund managed by DWS Infrastructure, declared its acquisition of Stagecoach unconditional. Stagecoach had backed out of an all-share merger with peer National Express (NEX).
A third UK operator, FirstGroup (FGP) has also received an approach.
On Thursday last week (9 June), FirstGroup said it rejected a possible takeover offer from I Squared Capital Advisors, saying the firm cash component undervalues the company and the contingent component doesn’t give shareholders enough certainty.
