European Event-Driven Analyst

Jesus Rodriguez Aguilar

Event-Driven

<ul>
<li>On 16 August, I Squared confirmed it did not intend to make an offer for FirstGroup thus will now be precluded from bidding for six months.</li>
<li>The 15 August offer implied almost no premium for the core business, significant value not reflected, and a difficult to grasp structure for most investors, in my view.</li>
<li>A SOTP approach gives a fair value of 183.4p. The board seems right in its refusal. Other bidders may appear or I Squared may return to the negotiating table. Long.</li>
</ul>


On 16 August, I Squared confirmed it did not intend to make an offer for FirstGroup thus will now be precluded from bidding for six months.
The 15 August offer implied almost no premium for the core business, significant value not reflected, and a difficult to grasp structure for most investors, in my view.
A SOTP approach gives a fair value of 183.4p. The board seems right in its refusal. Other bidders may appear or I Squared may return to the negotiating table. Long.


I Squared/FirstGroup: Why Have the Negotiations Ended?

<ul>
<li>FirstGroup's Board rejected a 118p + up to 45.6p contingent payment. PUSU deadline is 23 June, and can be extended with the consent of the Panel. </li>
<li>Infrastructure funds have put their sight on UK buses due to predictable revenues and a friendlier regulatory framework. The Board of FirstGroup is aware and should seek higher value.</li>
<li>I Square could bid a more palatable 166.8p/share: 144p/share (8.2x EV/Fwd EBIT, average of StageCoach and Go-Ahead transactions), plus 22.8p/share (50% discount to the maximum contingent payout). Long.</li>
</ul>


FirstGroup's Board rejected a 118p + up to 45.6p contingent payment. PUSU deadline is 23 June, and can be extended with the consent of the Panel. 
Infrastructure funds have put their sight on UK buses due to predictable revenues and a friendlier regulatory framework. The Board of FirstGroup is aware and should seek higher value.
I Square could bid a more palatable 166.8p/share: 144p/share (8.2x EV/Fwd EBIT, average of StageCoach and Go-Ahead transactions), plus 22.8p/share (50% discount to the maximum contingent payout). Long.


I Squared/FirstGroup: Looming PUSU Deadline

US/Europe Event-Driven Analyst

John DeMasi

<p><a href="https://www.smartkarma.com/entities/firstgroup-plc" target="_blank" data-smartkarma-citation="entities:21936:1" rel="noopener">Firstgroup PLC (FGP LN)</a> is a UK-based transit provider that has been in the sights of activist investors on and off for a number of years.</p>
<p>In this report I look at the history of activist tilts towards FGP LN including the latest attempt by Coast Capital, as well as delve into business performance and share price valuation, and see what it all means for event-driven investors.</p>

Firstgroup PLC (FGP LN) is a UK-based transit provider that has been in the sights of activist investors on and off for a number of years.
In this report I look at the history of activist tilts towards FGP LN including the latest attempt by Coast Capital, as well as delve into business performance and share price valuation, and see what it all means for event-driven investors.

FirstGroup Plc – Barbarians at the Bus Stop

United Kingdom

FirstGroup plc is an international passenger group which has bus and rail operations in the United Kingdom and North America.  The Group's operations comprise bus and passenger rail franchises, in addition to transit management, school bus operations, and fleet maintenance.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Firstgroup PLC (FGP LN)

I Squared/FirstGroup: Why Have the Negotiations Ended?

There is still significant value not reflected in the last offer. The board seems right in its refusal. Other bidders may appear or I Squared may...

Jesus Rodriguez Aguilar

I Squared/FirstGroup: Looming PUSU Deadline

Three out of four major London-listed bus operators have attracted private equity interest in recent months. Infrastructure funds seek the stable...

Jesus Rodriguez Aguilar

FirstGroup Plc – Barbarians at the Bus Stop

Firstgroup PLC (FGP LN) is a UK-based transit provider that has been in the sights of activist investors on and off for a number of years. In this...

John DeMasi

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)