Stagecoach to sell US business in £214m deal

BUS AND rail giant Stagecoach has agreed to sell its under-pressure US business in a deal valuing the division at 271.4 million US dollars (£214.4m).

It comes just weeks after Stagecoach first revealed talks to sell the North American arm after an £85.4m writedown in the division sent the group tumbling to a halfyear loss.

The sale to private equity firm Variant Equity Advisors will see Stagecoach receive 207 million US dollars (£163m) and transfer net debt of 64.4 million US dollars (£50.9m).

The deal is expected to complete by the end of the group’s financial year to April 27.

Stagecoach’s US business includes megabus.com inter-city coach services, commuter services, airport transportation, sightseeing tours and charter services.

But it has been struggling amid increased competition in the States.

Stagecoach said the sale will allow it to “realise an attractive valuation” for the business whilst refocusing its UK division and concentrating on growth opportunities in its domestic market.

Martin Griffiths, Stagecoach chief executive, said: “During our two decades in the North American transportation market, our success included reinvigorating the inter-city coach sector and delivering growth with our innovative megabus.com brand.”

He added: “The sale of our North American operations will allow management to focus more closely on the significant opportunities for growth in the UK.”