Stagecoach pulls out of North Devon deal after intervention by Office of Fair Trading

FirstGroup’s efforts to raise £100m by selling off “non core” sections of its UK bus business stumbled this week when Stagecoach pulled out of a £2.8m deal to purchase the group’s operations in North Devon.

The deal would have seen 30 vehicles on 10 routes transfer to Stagecoach, together with 100 employees and First’s depot in Barnstaple. However, Stagecoach withdrew its interest after the Office of Fair Trading decided to refer the deal to the Competition Commission.

A Stagecoach spokesman said: “We are extremely disappointed at the decision of the OFT to refer what is a relatively small transaction.

“We do not believe we can justify spending further money and management time on what has already been a lengthy process.”

Giles Fearnley, managing director of First UK Bus, said the OFT’s decision may lead to services being withdrawn and put jobs at risk. However, he does not believe that the competition authorities will scupper the group’s disposal programme.

“We are confident of future successful transactions in the coming months as a number of potential bidders exist in those markets where we have identified other businesses for disposal,” he said.

First is currently looking to sell off seven bus operations in England in the first tranche of its disposal programme (PT035).

 

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