Further push for National merger

A SECOND major shareholder in National Express has backed radical plans to shake up the coach and train group.

The Spanish Cosmen family, which owns 17.4 per cent of National Express, will throw its weight behind plans by US hedge fund Elliott Advisors, which aims to install three directors of its own choice and shift the direction of the group.

American hedge fund Elliott - which owns 17.5 per cent of National Express - has accused the current board of the transport firm of a "lack of ambition" which means that it has "under-performed against best-in-class operators like Stagecoach".

Elliott Advisors needs the support of 50 per cent of National Express shareholders to push through its proposals at next month's annual general meeting.

Elliott is proposing three main options for National - to consider a transformational merger, expand its US operations away from the under-pressure UK and European market, or sell some of its key assets.

Jorge Cosmen - who is also deputy chairman of National Express - first backed a merger with Stagecoach in 2009. In the same year the Cosmen family, along with private equity firm CVC, looked at taking a controlling stake in National Express for 765 million, but the deal collapsed.

At the end of last month, Elliott Advisors called on shareholders not to renew the tenure of non-executive director Roger Devlin and proposed three other candidates to join.

Although Elliott is critical of National's current board, it backs chief executive Dean Finch.