Stagecoach boss Sir Brian Souter to step down
Wednesday 22 August 2012
Stagecoach boss Sir Brian Souter today signalled his intention to step down from the driving seat of the company he co-founded more than 30 years ago.
Sir Brian, whose family owns a stake worth £400 million in the transport giant, will take on the role of chairman after deciding to relinquish day-to-day running of the firm he established with just two buses in Perth.
It is now one of the UK's biggest bus, coach and rail operators and a major operator in the United States with a stock market valuation of £1.7 billion.
The switch from chief executive to chairman goes against corporate governance codes but Stagecoach said it was important to retain the 58-year-old's expertise after he is replaced by finance director Martin Griffiths from May.
The boardroom change came as the company reported "good" trading in the 12 weeks to July 22 and said it remains on-track to hit full-year targets.
Sir Brian said: "I remain committed to the success of Stagecoach and consider now to be an appropriate time to plan to take a step back from the day-to-day management of the business."
The Perth-born entrepreneur worked as a bus conductor in Glasgow to fund his way through university where he was studying to become a chartered accountant.
He persuaded his sister Ann and her husband Robin to buy a bus for school runs and they later bought two coaches with their father's redundancy money, giving birth to Stagecoach, according to Sir Brian's website.
The deregulation of the bus services announced in 1985 paved the way for Stagecoach's expansion, with Sir Brian the master strategist.
One of its earliest services was Magicbus, which operated in Glasgow and offered passengers "unbelievably cheap fares" using old London Routemaster buses with conductors.
He led the company down an aggressive acquisition trail that saw it buy National Bus Company operations in Cumberland, Hampshire, East Midlands, Ribble, Southdown and the United Counties.
The expansion continued into the 1990s when Stagecoach bought further operations in Scotland, Newcastle, London and Manchester and it floated on the stock market to raise further funds.
The privatisation of the rail network in 1995 provided an opportunity to branch out into trains and Stagecoach became the first private sector company to win a rail franchise when it successfully bid for the UK's biggest rail franchise - South West Trains.
Today its rail portfolio includes South West and East Midlands Trains although its 49% stake in Sir Richard Branson's Virgin Rail Group recently lost the rights to the West Coast Main Line.
The business now has 13,000 buses, coaches, trains and trams in the UK and US and more than 30,000 employees worldwide. Some two million passengers use Stagecoach services in the UK every day.
Sir Brian took a £51 million pay-out last year after the company unveiled a £340 million cash hand-out - its second in four years. His sister Ann Gloag got almost £37 million for her 10.9% stake.
The group reported today that underlying revenues at its rail and regional bus businesses in the UK rose 6.8% and 4.1% respectively in its first quarter. Its London bus operations saw a 5.7% decline as it lets less profitable contracts go.
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