UK-listed transport operator FirstGroup has agreed to sell its US bus operations to EQT’s infrastructure fund in a £3.3bn deal that will pass the operation of tens of thousands of yellow school buses to the Swedish private equity group.
The sale of First Student and First Transit will allow FirstGroup to shore up its balance sheet after the company reported a £100m pre-tax loss for the six months to September. The rating agency Fitch warned in January that it may downgrade FirstGroup’s debt into junk territory if a sale of US operations was “unsuccessful”.
FirstGroup plans to use most of the proceeds to address longstanding liabilities and reduce debts, including repaying £300m of emergency government coronavirus loans. It will contribute £336m to its UK pension schemes, while shareholders are in line for a 30p per share payout, totalling £365m.
Source: Financial Times
By Harry Dempsey and Kaye Wiggins
