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Kelsian blames market volatility as it shelves Go-Ahead takeover bid

The Australian transport operator had urged Go-Ahead shareholders not to accept a bid from rivals Kinetic and Globalvia while it prepared an offer

Go Ahead Bus Depot in Hownsgill, Consett(Image: Evening Gazette)

A takeover of bus and rail operator Go-Ahead by Australian-Spanish consortium Kinetic and Globalvia is now likely to progress after rival bidder Kelsian abandoned its interest.

Adelaide-based Kelsian blamed volatile Australian equity markets for its withdrawal, saying its own share price had been affected recently. In a statement the firm said: "Unfortunately, recent Australian equity markets have been volatile and external events have adversely impacted the Kelsian share price since June 14, 2022 when Kelsian first announced it was considering a possible offer for Go-Ahead.

"The Kelsian Board consider that Australian equity market conditions at this time do not enable Kelsian to pursue a possible transaction for Go-Ahead despite the long-term strategic and economic rationale of the potential transaction for Kelsian."

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The move leaves a consortium of Kinetic TCo Pty Ltd - Australia and New Zealand's largest bus network - and Spanish transport firm Globalvia Inversiones S.A.U - as the sole bidder. An offer made in June by the partners entitles shareholders to 1,500 pence for each Go-Ahead share, valuing the firm at £647.7m. On news of Kelsian's withdrawal, Go-Ahead shares were trading at 2% higher than the offer.

In an update to its investors Go-Ahead said it continued to recommend the consortium offer to shareholders and urged them to vote in favour of it at a general meeting to be held on August 8. In June, Go-Ahead's group chief executive Christian Schreyer said the offer was "compelling" and combined an attractive valuation with good prospects for the business.

He said: “We have confidence in Go-Ahead’s future as an independent business, but see that being part of a truly global mass transit platform will yield exciting opportunities.

"We welcome the commitment of Kinetic and Globalvia to invest in the decarbonisation and digitalisation of our operations, and to support our strategy, The Next Billion Journeys. As a standalone business within a global platform, we will be better placed than ever to connect communities and to fulfil our purpose of moving our customers towards a smarter and healthier planet.”