National Express has now been given until mid-December to make a formal takeover bid for Stagecoach. ALAN MILLAR considers why this deal may happen, what the combination might bring and the history of two groups with origins in the operation of intercity coaches
The timing of the announcement, on September 21, that National Express and Stagecoach were discussing a possible “merger” — actually a takeover of Stagecoach by NatEx — may have taken many onlookers by surprise, but the signs have been building over the past two years that the existing structure of the UK operating industry would not endure for much longer.
This predates the Covid-19 pandemic, which has reduced demand for public transport — perhaps permanently — and weakened operators’ ability to deliver services on a commercial basis.
Before the first reports of the illness began to emerge in China towards the end of 2019, two of the big groups were effectively up for sale. Deutsche Bahn was trying to float off or find a buyer for Arriva, with its bus and train business across the UK and continental Europe. It still is. First looked as if it would turn itself into an American business and was contemplating the disposal of First Bus in the UK and Ireland; instead, it has pacified rebellious shareholders by staying British and finding new owners for its North American divisions.