Coach operator National Express said on Thursday that its proposed £1.9bn all-share combination with Stagecoach represented “a superior value creation opportunity” when compared to an offer from German infrastructure fund DWS.
National Express stated that DWS’ 105.0p per share offer “materially undervalues” Stagecoach, which withdrew its backing for the merger with National Express. The National Express deal values Stagecoach at £445.0m, while the DWS deal places the group’s value at £595.0m.
However, National Express said a recent share price recovery to pre-pandemic levels of 421.0p implied “an illustrative look-through value” per Stagecoach share of around 170.0p, which represented a 66% premium to the DWS offer.
The FTSE 250-listed firm also highlighted that the combination of the two companies would create a leading multi-modal transportation provider in the UK and deliver significant synergies.
“In a period that has seen a surge of private equity firms acquiring British companies, the combination represents a rare example of two UK listed companies combining to form a global leader in their industry,” said National Express.
As of 0810 GMT, National Express shares were up 0.95% at 234.40p.
