ARCHIE MITCHELL A MAJOR First Group shareholder has welcomed the firm's decision to consider a sale of its US businesses.
The transport giant yesterday said it has appointed advisers to review its US school bus and public transit arms, adding that it will "explore all options" a month after a sinking share price pushed two big investors to urge it to dump its North American assets.
"Today is a victory for the shareholders, because at least they get transparency into what the company's intentions are," said shareholder Robert Tchenguiz, who owns a 4.7 per cent stake in the transport firm.
He added he hoped divesting from the US would boost First Group's market cap to the extent that shareholders could realise the value of their investments. "The shares should reflect the true value of the breakup right now," he said.
First Group has come under increasing pressure from Tchenguiz and other investors including Coast Capital Management to sell off its US divisions, which include First Student and First Transit.
First Group's share price climbed 5.9 per cent to 125.4p following the announcement.
(c) 2019 City A.M., source Newspaper