National Express has continued its takeover battle with DWS for Stagecoach.

In its trading update the firm says its believes its proposed combination with Stagecoach with “£45m of run-rate synergies” is a “superior value creation opportunity to the DWS offer”.

DWS Infrastructure came forward with a £595m offer for Stagecoach in March – more than £200m than the current value of National Express’s all-share bid.

Following news of DWS’s superior bid – and the shift in support by Stagecoach’s board to its offer – saw National Express’s share price respond positively.

National Express’s offer to give 0.36 National Express shares in exchange for each Stagecoach share was worth £385m before DWS’s offer was made public. On March 16th’s closing price of 232p, the deal would have been valued at £460m.

In its trading update, National Express reported its revenue is back to levels seen pre-pandemic, with March 2022 ahead of March 2019, revenue has increased by 30% year on year.

It says there has been a particularly strong recovery seen in its UK and ALSA coach businesses, demonstrating strong pent-up demand for travel.

The firm aims to deliver at least £1.25bn of free cash flow between 2022 and 2027.

Ignacio Garat, Group Chief Executive, said: “The strong recovery in our discretionary coach businesses in both the UK and Spain shows the pent-up demand for travel which is further evidenced by our strong trading over Easter.

“The cost of living crisis is starting to bite for many people, and our bus services offer an attractive low cost alternative form of travel to help offset higher prices elsewhere.

“Modal shift out of cars is the single most important thing we can do to tackle climate change – and National Express has a major role to play here, providing safe, reliable and affordable services that not only help our planet but also our passengers in their daily lives”.

Source: The Business Desk.Com