Consortium bidding for National Express ups offer

The Spanish consortium in the running for National Express has upped its offer to 450p per share, leaving shareholders with a choice between the £689m approach and the board’s proposal for a £350m rights issue.

The consortium led by CVC Capital Partners, a private equity group, also includes the Cosmen family, who already own 18.6 per cent of National Express following the company’s £149m acquisition of Alsa, the Spanish bus operator owned by the family, in 2005. Jorge Cosmen, who is deputy chairman of National Express, has not been present at any of the relevant board meetings.

The approach is understood to include a number of caveats, including conditions relating to National Express’s surprise exit from the £1.4bn East Coast Mainline franchise and the future of its two other rail contracts, c2c and East Anglia.

The beleaguered transport group said yesterday it was considering the new offer, revised upwards from last month’s 400p-per-share pitch, and would respond in due course.

“The Independent Board continues to explore a range of options to accelerate the reduction of the group’s borrowings in a way that will create value for all National Express shareholders,” National Express told the Stock Exchange yesterday. “In this context, the Independent Board has been discussing a potential equity fundraising with investors should a recommendable offer not be forthcoming.” National Express is in serious trouble. It is labouring under nearly £1bn debts, and despite doing a deal with its bankers in June to relax the terms, is still in danger of breaching its covenants.

Matters came to a head with the high-profile debacle over East Coast Mainline train in early July. To fund contractual payment commitments that hit £138m this year alone, National Express needed passenger revenue growth of more than 9 per cent. But recession sent growth plummeting to just 0.3 per cent and the Government refused to renegotiate, leaving no option but for the line to be taken back into public ownership. National Express’s chief executive, Richard Bowker, resigned the same day.

Lord Adonis, the Transport Secretary, has also threatened to strip National Express of the c2c and East Anglia franchises, as well as hinting heavily that the group is unlikely ever to win another rail contract.

Notwithstanding the problems, National Express is keen on an independent future and sources suggest that only an offer of 500p-per-share or more would be considered a fair representation of its value.

The CVC/Cosmen consortium is the only interested suitor. Rival transport giant FirstGroup made an all-share approach in June, only to be rejected on the grounds that it would be “inappropriate”. FirstGroup has been quiet on the subject since, but at the time it did not rule out another try. “The board of FirstGroup continues to believe that there is significant industrial and commercial logic in a combination of the two companies,” it said in a statement.

Within a month of FirstGroup’s rejection, the CVC/Cosmen consortium joined the fray and the Takeover Panel set a Put Up or Shut Up deadline of 11 September. Meanwhile Stagecoach started talks with the consortium about the possibility of buying parts of National Express should the acquisition go ahead. Stagecoach has also not ruled out making an offer of its own.

Start your day with The Independent, sign up for daily news emails
New Articles
tvDownton Abbey Christmas special
Arts and Entertainment
Wolf (Nathan McMullen), Ian (Dan Starky), The Doctor (Peter Capaldi), Clara (Jenna Coleman), Santa Claus (Nick Frost) in the Doctor Who Christmas Special (BBC/Photographer: David Venni)
tvOur review of the Doctor Who Christmas Special
News
peopleIt seems you can't silence Katie Hopkins, even on Christmas Day...
Arts and Entertainment
Left to right: Stanley Tucci, Sophie Grabol and Christopher Eccleston in ‘Fortitude’
tvSo Sky Atlantic arrived in Iceland to film their new and supposedly snow-bound series 'Fortitude'...
PROMOTED VIDEO
Arts and Entertainment
Kellie Bright as Linda Carter and Danny Dyer as Mick Carter

EastEnders Christmas specials are known for their shouty, over-the-top soap drama but tonight the show has done itself proud thanks to Danny Dyer.

Arts and Entertainment
Jenna Coleman as Clara Oswald in the Doctor Who Christmas special
tvForget the rumours that Clara Oswald would be quitting the Tardis
Arts and Entertainment
Japanese artist Megumi Igarashi showing a small mascot shaped like a vagina
art
News
The Queen delivers her Christmas message
newsTwitter reacts to Her Majesty's Christmas Message
Arts and Entertainment
tv
Life and Style
fashion
Sport
sport
ebooks
ebooksA year of political gossip, levity and intrigue from the sharpest pen in Westminster
Arts and Entertainment
Call The Midwife: Miranda Hart as Chummy
tvCall the Midwife Christmas Special
Sport
Laura Trott and Jason Kenny are preparing for the Commonwealth Games in Glasgow
sport
Arts and Entertainment
Sir Bruce Forsyth with Tess Daly in the BBC's Strictly Come Dancing Christmas Special
tvLouis Smith wins with 'Jingle Bells' quickstep on Strictly Come Dancing's Christmas Special
News
news
Arts and Entertainment
tv
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Selby Jennings: Oil Operations

Highly Competitive: Selby Jennings: Our client, a leading European Oil trading...

The Jenrick Group: Night Shift Operations Manager

£43500 per annum + pension + holidays: The Jenrick Group: Night Shift Operatio...

SThree: Trainee Recruitment Consultant - LONDON

£20000 - £25000 per annum + OTE £40,000 + Car + Pension: SThree: SThree are a ...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £35K: SThree: We consistently strive to be the...

Day In a Page

Isis in Iraq: Yazidi girls killing themselves to escape rape and imprisonment by militants

'Jilan killed herself in the bathroom. She cut her wrists and hanged herself'

Yazidi girls killing themselves to escape rape and imprisonment
Ed Balls interview: 'If I think about the deficit when I'm playing the piano, it all goes wrong'

Ed Balls interview

'If I think about the deficit when I'm playing the piano, it all goes wrong'
He's behind you, dude!

US stars in UK panto

From David Hasselhoff to Jerry Hall
Grace Dent's Christmas Quiz: What are you – a festive curmudgeon or top of the tree?

Grace Dent's Christmas Quiz

What are you – a festive curmudgeon or top of the tree?
Nasa planning to build cloud cities in airships above Venus

Nasa planning to build cloud cities in airships above Venus

Planet’s surface is inhospitable to humans but 30 miles above it is almost perfect
Surrounded by high-rise flats is a little house filled with Lebanon’s history - clocks, rifles, frogmen’s uniforms and colonial helmets

Clocks, rifles, swords, frogmen’s uniforms

Surrounded by high-rise flats is a little house filled with Lebanon’s history
Return to Gaza: Four months on, the wounds left by Israel's bombardment have not yet healed

Four months after the bombardment, Gaza’s wounds are yet to heal

Kim Sengupta is reunited with a man whose plight mirrors the suffering of the Palestinian people
Gastric surgery: Is it really the answer to the UK's obesity epidemic?

Is gastric surgery really the answer to the UK's obesity epidemic?

Critics argue that it’s crazy to operate on healthy people just to stop them eating
Homeless Veterans appeal: Christmas charity auction Part 2 - now LIVE

Homeless Veterans appeal: Christmas charity auction

Bid on original art, or trips of a lifetime to Africa or the 'Corrie' set, and help Homeless Veterans
Pantomime rings the changes to welcome autistic theatre-goers

Autism-friendly theatre

Pantomime leads the pack in quest to welcome all
The week Hollywood got scared and had to grow up a bit

The week Hollywood got scared and had to grow up a bit

Sony suffered a chorus of disapproval after it withdrew 'The Interview', but it's not too late for it to take a stand, says Joan Smith
From Widow Twankey to Mother Goose, how do the men who play panto dames get themselves ready for the performance of a lifetime?

Panto dames: before and after

From Widow Twankey to Mother Goose, how do the men who play panto dames get themselves ready for the performance of a lifetime?
Thirties murder mystery novel is surprise runaway Christmas hit

Thirties murder mystery novel is surprise runaway Christmas hit

Booksellers say readers are turning away from dark modern thrillers and back to the golden age of crime writing
Anne-Marie Huby: 'Charities deserve the best,' says founder of JustGiving

Anne-Marie Huby: 'Charities deserve the best'

Ten million of us have used the JustGiving website to donate to good causes. Its co-founder says that being dynamic is as important as being kind
The botanist who hunts for giant trees at Kew Gardens

The man who hunts giants

A Kew Gardens botanist has found 25 new large tree species - and he's sure there are more out there