Stage­coach to sell US coach arm as it swerves into the red

The Daily Telegraph - Business - - Business - By Oliver Gill

STAGE­COACH in­sists it will not sell its trou­bled US coach arm “at any cost” de­spite swing­ing sharply into the red fol­low­ing a hefty write­down on op­er­a­tions across the At­lantic.

The bus and rail giant an­nounced yes­ter­day that it had opened sale talks with a num­ber of par­ties for all or part of its US net­work.

The an­nounce­ment came as the com­pany posted a £22.6m half-year pre-tax loss, driven by a painful £85.4m write­down of its US in­vest­ment.

Stage­coach also shoul­dered a £24.2m cost to equalise min­i­mum pen­sion ben­e­fits be­tween men and women.

Shares rose around 15pc and the com­pany’s val­u­a­tion briefly broke through the £1bn bar­rier as profit mar­gins on Stage­coach’s UK rail arm beat City ex­pec­ta­tions.

Putting US coach op­er­a­tions on the mar­ket had been widely ex­pected.

The sale of the US coach arm threat­ens to put Stage­coach on a col­li­sion course with ri­val FirstGroup, which is un­der pres­sure from in­vestors to sell its own US busi­ness.

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