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FirstGroup trading in line YTD, announces tender offer

By Iain Gilbert

Date: Monday 13 Sep 2021

FirstGroup trading in line YTD, announces tender offer

(Sharecast News) - Transport business FirstGroup said on Monday that its year-to-date trading performance was in line with expectations and that it would be launching a tender offer in order to return some value to shareholders.
FirstGroup said First Bus passenger volumes were now at an average of 65% of pre-pandemic levels in recent weeks, with the firm expecting this to increases further as the autumn terms for schools and universities get fully underway.

Passenger mileage in its non-core Greyhound operations was just over 50% of pre-Covid levels.

Additionally, FirstGroup said that after having considered various methodologies and consulting with a range of shareholders, it has concluded that a tender offer would be the "optimal way" to return "a significant amount" of value to investors in a short space of time while also giving shareholders who wish to retain their current investment in FirstGroup the option to do so.

Under the tender offer, qualifying shareholders will be invited to tender some or all of their shares at a price per share that will be announced at the time of launch. If the full amount is not returned to shareholders by way of the tender offer, the group intends to return any remaining surplus cash in a second phase, principally by way of a special dividend with an accompanying share consolidation, supplemented by on-market share buybacks.

Chairman David Martin said: "Trading is in line with our expectations year-to-date, and we continue to support our passengers and other stakeholders as travel patterns evolve.

"The vital role of public transport is clear and the policy backdrop has never been more supportive. With a well-capitalised balance sheet and an operating model that will support an attractive dividend for shareholders commencing in 2022, I am confident that FirstGroup is well-placed to deliver sustainable value creation as a focused UK public transport leader."

As of 0920 BST, FirstGroup shares were up 2.37% at 88.55p.

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