27th Apr 2007 07:02
National Express Group PLC27 April 2007 Friday 27 April 2007 For immediate release National Express Group PLC National Express acquires Continental Auto for £449.7 million (€659.3 million)in cash and consolidates its position as one of Spain's leading public transport groups National Express Group PLC ("National Express" or "the Group") is pleased toannounce that it has agreed to acquire Continental Auto SL ("Continental Auto"),a leading operator of public transport services in Spain, from Grupo ACS ("ACS"), for £449.7 million (€659.3 million) in cash to be funded from acombination of its existing bank facility and a new committed bank facility. Thetransaction, which is expected to be earnings enhancing for the Group on anormalised basis in its first full year, is expected to complete before the endof 2007. Transaction highlights * The transaction consolidates the Group's position as a leader in the Spanish public transport market, following the acquisition of Alsa in December 2005; * Continental Auto, headquartered in Madrid, is a highly respected, well established coach and bus operator. Its extensive North-South long distance coach network complements Alsa's existing operations; * Continental Auto's Regional, Commuter and Urban networks significantly enhance Alsa's presence in these attractive markets. Continental Auto provides access to the key Andalucian and Catalonian regions, as well as operating bus concessions in Madrid and Almeria; * Continental Auto has a strong financial track record, delivering double-digit margins and excellent cash flow generation, underpinned by long-term, predictable concessions maturing between 2013 and 2028; and * Continental Auto has made significant investment in its modern fleet of 860 buses and coaches with an average age of 4.4 years. On completion, National Express will have more than 2,100 vehicles in Spain andcarry more than 142 million passengers per year. The combination of ContinentalAuto's and Alsa's networks will create a comprehensive national presence. Thisoffers the opportunity to integrate the operational excellence of Alsa and thecustomer offering of the Group's UK coach operations across the broaderContinental Auto product range. Spain is one of the largest and fastest growing European public transportmarkets. This market is expected to show strong growth driven by continuedinvestment in infrastructure including the roll-out of significant numbers ofdedicated bus lanes, assisted by favourable political policy initiatives towardspublic transport. Continental Auto's growing Commuter network will be furtherenhanced by Madrid's new high occupancy vehicle lanes, expected to be completedin 2009. Continental Auto currently operates in 11 regions, 29 provincialcapitals and 2,600 municipalities. In an increasingly liberalised market, theGroup will be uniquely positioned to participate in this growth. Completion of the acquisition is subject to approval by the Spanish competitionauthorities. In the year to 31 December 2006 Continental Auto generated total revenues of£134.0 million (€196.5 million) and profit before tax of £18.6 million (€27.3million). As at 31 December 2006, Continental Auto had gross assets of £224.6million (€329.3 million) and net assets of £143.0 million (€209.7 million). Aspart of the transaction, the Group will assume existing Continental Auto netdebt. This was £14.1 million (€20.7 million) as at 31 December 2006. Commenting on the transaction, Richard Bowker, Chief Executive of the NationalExpress Group said: "Continental Auto is a quality business and we aredelighted that it will join the Group. This transaction fits perfectly with ourstated strategy of utilising our strong balance sheet to acquire businesses inour core markets where our unparalleled management skills and experience can beapplied. We anticipate significant growth opportunities in our Spanish businessin 2007 and beyond. This transaction will reinforce our position as a leadingprovider in the Spanish public transport market. We look forward to working withall stakeholders to deliver the highest quality services to our customers." National Express has been advised on this transaction by Merrill LynchInternational. Trading Update The Group has also released today a separate statement on current trading. - E ND S - For further information, please contact: National Express Group PLC +44 20 7529 2000Richard Bowker, Chief Executive Adam Walker, Finance DirectorNicola Marsden, Director of Group Communications Maitland +44 20 7379 5151Neil Bennett/Suzanne Bartch/Brian Hudspith Merrill Lynch International +44 20 7628 1000Kevin J. Smith, Investment BankingJustin Anstee, Investment BankingSimon Fraser, Corporate BrokingAndrew Osborne, Corporate Broking Notes to Editors • There will be a conference call for research analysts and investors at 09: 00 (BST) today, 27 April 2007. For details please contact Rebecca Mitchell at Maitland on +44 20 7379 5151. Copies of the presentation will be available from our website www.nationalexpressgroup.com. • Euro exchange rate used is £1:€1.4660. The statements that the transaction is expected to be earnings enhancing on anormalised basis in its first full year do not constitute a profit forecast andshould not be interpreted to mean that earnings for those years or anysubsequent financial period would necessarily be greater than those for anypreceding financial period. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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