Activist investor demands changes at UK’s FirstGroup

U.S. activist shareholder Sandell Asset Management went public on Wednesday with a demand for British transport operator FirstGroup (FGP.L) to split off its U.S. business to invest in its domestic arm. Sandell, which owns just over 3 percent of the struggling company, wrote to the directors of FirstGroup to urge them to spin off and float the U.S. unit which includes the yellow school buses that operate across 38 states in the United States. It also called for the group to sell the iconic Greyhound bus service, which transports 18 million passengers across America each year. A spin off and disposal of the U.S. assets could appeal to yield-hungry North American shareholders and to industry buyers due to its strong brand and cash-flow generation, the investor said, enabling the group to invest in its British bus business and bid in future rail franchises.


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