RNS Number:7048V
Stagecoach Group PLC
15 December 2005
STAGECOACH GROUP PLC
Acquisition of Traction Group Limited
15 December 2005
Stagecoach Group plc ("Stagecoach") is pleased to announce that on 14 December
2005, it completed the acquisition of the entire share capital of Traction Group
Limited ("Traction"). The principal vendors are Mr Frank Carter, (who prior to
the acquisition was Chairman and Managing Director of Traction), two trusts in
favour of members of Mr Frank Carter's family and a Traction employee share
ownership trust.
Traction is the sixth largest operator of bus services in the UK and is the
largest operator that was still privately owned. Traction's operations are
centred on South and West Yorkshire, Lincolnshire and Tayside. In its financial
year ended 31 December 2004, Traction reported turnover of #56.6million,
operating profit of #2.5 million and gross assets of #50.5million.
The consideration paid for the shares was approximately #26.0million, which was
satisfied by #21.5million in cash and the issue of 4,022,070 Stagecoach ordinary
shares of 12/19th pence each. Stagecoach has assumed Traction's net debt of
approximately #11.0million. The consolidated net debt of Stagecoach will
therefore increase by approximately #32.5million as a result of the acquisition.
Application has been made to the London Stock Exchange and UK Listing Authority
for the admission to the Official List of the new ordinary shares and listing is
expected to become effective on 16 December 2005. The new ordinary shares will
rank pari passu with the existing ordinary shares.
Brian Souter, Chief Executive of Stagecoach Group plc, commented: "The
acquisition of Traction is consistent with our strategy for growth in our core
UK and North American markets, and follows the acquisition of Glenvale Transport
earlier this year.
"Traction is the largest of the remaining privately-owned UK bus operators. We
are excited by the prospects of acquiring Traction, and believe we can add value
through innovation, investment and by applying Stagecoach's operational
expertise.
"Stagecoach's investment in improved services and initiatives - including
Kickstart, sector-leading telemarketing campaigns and online sales - is seeing
large numbers of people return to the nation's buses and demonstrates our
ability to deliver impressive growth."
In the recently reported Stagecoach Group results for the six months ended 31
October 2005, revenue in the UK Bus division was up 10.5%.
- ENDS -
CONTACTS:
Stagecoach Group plc
Martin Griffiths, Finance Director
Telephone
01738 442 111
Steven Stewart, Head of Media & Public Affairs
07764 774680
Smithfield
John Kiely
020 7360 4900
This information is provided by RNS
The company news service from the London Stock Exchange
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