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| 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%. |
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