Megabus, Falcon retail activity to go to Scottish Citylink

Megabus and Falcon retail activity to be sold to Scottish Citylink JV

Stagecoach has reached agreement to sell the retailing activities of its Megabus and Falcon scheduled coach businesses to Scottish Citylink, the well-established joint venture (JV) between the group and ComfortDelGro.

The transaction is expected to complete in mid-August. It will also see Stagecoach’s share in Scottish Citylink increase from 35% to 37.5%.

Announcement of the sale agreement represents a change from an earlier position that, under initial plans for Stagecoach to be purchased by National Express, would have seen Scottish Citylink take on the marketing, retail and customer service activities of Megabus and Falcon but also become wholly owned by ComfortDelGro in a deal slated at the time to be worth £8.75m.

The proposed purchase by National Express subsequently collapsed and Stagecoach was instead acquired by DWS Infrastructure. The Scottish Citylink JV is already responsible for services operating under that brand, along with Megabus-branded routes to, from and within Scotland.

At the time that the earlier, more extensive planned deal between Stagecoach and ComfortDelGro was announced, the prospective purchaser said it was planning to further expand its provision of scheduled coach routes in the UK with “new and innovative” services. Since then, ComfortDelGro has agreed a €12m purchase of Galway-based GoBus to make it Ireland’s country’s third-largest scheduled coach operator.

Around 30 Stagecoach employees are expected to transfer to Scottish Citylink as part of the sale of Megabus and Falcon retail activities. No changes will be made to the operation of those services, with vehicles and drivers still provided by Stagecoach.

Speaking about the latest agreement, Stagecoach Chief Executive Martin Griffiths says: “Inter-city coach has a positive future as a greener and better-value alternative to the car and as the UK rail network continues to see rising fares and operational challenges.

“The agreement we have reached with ComfortDelGro will provide certainty for employees in these businesses and ensure that we can continue to benefit from future growth in the inter-city coach market through our increase share in the Scottish Citylink joint venture.”

Adds Sean O’Shea, speaking on behalf of ComfortDelGro as CEO of its Metroline subsidiary: “ComfortDelGro’s 20-year relationship with Stagecoach in Scotland is set to expand, and I look forward to working together to deliver great services for inter-city customers in England and Wales.”