Activist investor calls for breakup of UK’s FirstGroup

U.S. activist investor Sandell Asset Management demanded British transport operator FirstGroup (FGP.L) split off its U.S. business, owner of the yellow school buses that operate across the country, to invest in its domestic arm. The hedge fund’s public attack caps a torrid year for FirstGroup, the leading transport operator in Britain and North America that handles more than 2.5 billion passengers a year. Sandell, which owns just over 3 percent of FirstGroup, wrote to the directors urging them to spin off and list the U.S. business on the stock market. Sandell said on Wednesday a break-up would enable FirstGroup to fund a much-needed investment program in its British bus business and to bid from a position of strength when the next round of rail franchises come up for tender.


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