Bus operator Go-Ahead in talks with two suitors over takeover

Transport firm Go-Ahead has received two takeover approaches which the regional bus operator said it would “be minded to” accept if a firm bid is made.

Shares in the company surged by more than 20% after the moves were confirmed, taking its market valuation to over £620 million.

It told shareholders on Monday morning that it received one unsolicited approach from Australian firm Kelsian.

It comes a month after Kelsian sold its east London bus operations to rival Stagecoach for £20 million.

Go-Ahead also confirmed that it was approached regarding a potential takeover bid by a consortium consisting of fellow Australian bus operator Kinetic and transport infrastructure company Globalvia.

The group, which is the UK’s biggest operator of double decker buses, did not disclose the value of the approaches.

It added that there “can be no certainty” that an offer will be made by either suitor.

In a statement, Go-Ahead said: “The board of Go-Ahead carefully evaluated the approaches from each of Kelsian and the Consortium together with its financial adviser, Rothschild & Co.

“Following the response by the board of Go-Ahead to their respective approaches, Kelsian and the Consortium each submitted a series of revised proposals.

“The most recent revised proposals received from each of Kelsian and the Consortium are both at a level which, should a firm offer be made, the board of Go-Ahead would be minded to recommend such a firm offer to Go-Ahead shareholders, subject to the agreement of other customary terms and conditions.”

The approaches come amid a rise in takeover interest in the transport sector as investors bank on the industry’s continued recovery following the impact of the pandemic.

Rival Stagecoach is set to be bought by German investor DWS in a £595 million deal, after it received support over a previous merger deal by coach giant National Express.

Go-Ahead shares were up 20% at 1,452p on Monday morning.