FirstGroup PLC (LSE:FGP) has signed an agreement to acquire York Pullman Bus Company Ltd, which operates private hire coach and bus routes in the city and surrounding area.
Set to be completed in the coming weeks, the takeover will offer profitable growth opportunities in the private hire market, the FTSE 250-listed group said on Friday.
York Pullman operates 130 vehicles and offers contracted school and college services, private hire for the likes of rail replacement and runs a small number of local bus routes.
“The acquisition of York Pullman, a long-established, high-performing business fits well with our strategy,” FirstGroup chief executive Graham Sutherland commented.
“It will both enhance the First Bus operational footprint in North Yorkshire and expand our adjacent services business, where we are looking to grow our presence.”
Following the takeover, First anticipates year-end adjusted net cash will sit between £60 million and £70 million, with around £30 million of an ongoing share buyback yet to be completed.
Managing director Tom James will remain with York Pullman, which reported pre-tax earnings of around £2 million and revenue of £10 million last year.
FirstGroup shares climbed 1% to 170.80p.