Disposal

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION

FOR IMMEDIATE RELEASE

14 December 2021

Stagecoach Group plc ("Stagecoach")

Sale of Scottish Citylink stake and the retail and customer service activities of Megabus UK and Falcon

· Stagecoach is pleased to announce that it has entered into agreements to sell the marketing, retail and customer service activities of three of its inter-city coach businesses to ComfortDelGro Corporation Limited ("CDG"), (together the "Disposal") namely:

· Stagecoach's 35% interest in Scottish Citylink Coaches Limited, a joint venture between Stagecoach and CDG, which markets and retails inter-city coach services in Scotland and between Scotland and England ("Scottish Citylink");

· the UK Megabus business which markets and retails inter-city coach services in England and Wales ("Megabus UK"); and

· Falcon South-West, which markets and retails tickets for a single coach route between Plymouth, Bristol and Bristol Airport ("Falcon").

· The total proceeds for the Disposal are £8.75 million, which is expected to complete on 28 February 2022.

Martin Griffiths, Stagecoach Chief Executive, commented:

"Stagecoach developed the Megabus brand in 2003, as we saw real potential in the long-distance inter-city coach market in the UK. In 2005, our belief in this market saw us create a joint venture with CDG to run the Scottish Citylink business and we further expanded our inter-city coach business with the development of our bespoke Falcon service in the South West of England serving Bristol Airport. Through this transaction, Stagecoach ensures that those business will continue to thrive under the ownership of the world renowned CDG brand".

Overview

Stagecoach, through its wholly owned subsidiary Stagecoach Bus Holdings Limited, announces the sale of the entirety of its 35% stake in Scottish Citylink to Braddell Limited, a wholly owned subsidiary of CDG, which owns the majority 65% stake in Scottish Citylink.

In addition, Stagecoach through its wholly owned subsidiaries: Stagecoach Services Limited, Stagecoach Bus Holdings Limited, Midland Red South Limited and Stagecoach Devon Limited announces the sale of the marketing, retail and customer services activities of its Megabus and Falcon inter-city coach businesses to Scottish Citylink, which will then be a wholly owned subsidiary of Braddell Limited.

Stagecoach will continue to provide sub-contracted bus and coach operational services to the inter-city coach operations which will now be owned by CDG.

The Disposal proactively addresses potential regulatory considerations in respect of the recommended combination with National Express Group plc announced today ("Offer").

Terms of the Disposal

The consideration for the Disposal is £8.75 million, comprising £7 million payable in cash at completion and the assumption by CDG of an existing shareholder loan of £1.75 million extended to Stagecoach Bus Holdings Limited by Scottish Citylink.

The cash proceeds will be retained and applied towards Stagecoach's general corporate purposes.

Condition to completion and indicative timetable

Completion of the Disposal is subject to the condition that the Offer has not been withdrawn, lapsed or terminated, and on the completion date, the board of directors of Stagecoach not having withdrawn or otherwise changed its recommendation to Stagecoach shareholders in relation to the Offer.

The Disposal constitutes a Class 2 transaction for the purposes of the UK Financial Conduct Authority's Listing Rules, and, as such, does not require approval by Stagecoach shareholders.

Additional financial information

For the half-year to 30 October 2021 the marketing, retail and customer service operations of Megabus UK and Falcon had operating losses of £3.9m, and for the full year to 1 May 2021, operating losses were £3.7m. Stagecoach's share of operating profit in Scottish Citylink for the half-year to 30 October 2021 was £0.1m and for the full year to 1 May 2021 it was an operating loss of £0.4m.

For the full year to 27 April 2019, which was the last full financial year prior to Covid-19, the marketing, retail and customer service operations of Megabus UK and Falcon had operating profit of £0.7m. For that same period, Stagecoach's share of operating profit in Scottish Citylink was £2.5m.

The gross assets of the marketing, retail and customer service operations of Megabus UK and Falcon as at 30 October 2021 were £0.4m. Stagecoach's share of the gross assets of Scottish Citylink as at 30 October 2021 was £5.7m.

The person responsible for arranging the release of this announcement on behalf of Stagecoach Group plc is Michael Vaux, Company Secretary.

Further information

For further information, please contact:

Stagecoach Group plc www.stagecoachgroup.com

Investor Relations

Ross Paterson, Finance Director 01738 442111

Bruce Dingwall, Group Financial Controller 01738 442111

Media

Steven Stewart, Director of Corporate Communications 07764 774680