FirstGroup shares shot up nearly 10% yesterday after the transport giant confirmed it had rejected a takeover approach by American private equity firm Apollo Management.
The Aberdeen headquartered firm said it had received a “preliminary and highly conditional indicative proposal” related to a possible all-cash offer for the business, though the financial details of the potential deal were not disclosed. Apollo has until 5pm on May 9 to make a firm offer for the business.
FirstGroup shares rose as much as 9.7% on following the news, making it one of the best performers on the FTSE 250.
FirstGroup in February reported a 10.7% rise in year-to-date revenue, though when stripped of currency effects and excluding South Western Railway franchise that increase was just 1.1%.
It said all three North American divisions struggled with “extremely challenging” weather in January, while its Greyhound bus long-haul business in North America was hit by competition with low-cost airlines. Like-for-like revenues for Greyhound bus operations slumped 0.4% for the year to date and fell 2.8% between September and January.