I Squared bid for FirstGroup not enough for some large shareholders

(Sharecast News) - The possible takeover of FirstGroup by an American private equity firm was called into question on Monday morning, with some of its biggest shareholders saying the offer was "falling short".

I Squared has offered up to 163.3p per share for the passenger transport operator, although 45.6p of that remained conditional on how much FirstGroup gets from the already-agreed sale of its US operations.

According to the Times, some "key shareholders" had said that the cash offer should be full and unconditional, independent of whatever proceeds the company gets from asset sales.

Schroders, which has a near-18% stake in FirstGroup, told the Sunday Times that the offer didn't reflect the firm's value as a large rail and bus operator in the UK.

FirstGroup shares were still trading well below the upper range of I Squared's bid, with the company's board facing pressure to declare its position before it published its full-year results on 14 June.

At 0908 BST, shares in FirstGroup were up 1.46% at 139p.

Reporting by Josh White at Sharecast.com.

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