Bowker quits as National Express boss
RICHARD BOWKER, the chairman of bus and rail operator National Express, stood down last night after a tumultuous month for the company, Morning Wire can confirm.
Bowker, once group commercial director of Virgin Group and co-chairman of Virgin Rail, quit ahead of today’s update regarding the operating terms on the east coast main line, which the firm is disputing.
National Express, which carries 320m bus passengers a year in the UK, and transports 164m passengers on train services, is contracted to pay the government £1.4bn to run the line, but is struggling to meet costs as passenger numbers dwindle.
Investors have been pressuring the company to renegotiate its repayment terms.
But the Department for Transport has repeatedly said it won’t budge on the deal.
It is estimated that the east coast contract will lose the group £90m over the next two years as payments to the DfT go up from £85m to £133m, before hitting £395m by 2015.
Meanwhile, National Express was approached by larger rival FirstGroup to create a global giant last month.
But National Express rejected the approach, saying it did not “consider it appropriate” to enter into talks.
The approach from FirstGroup – the company which operates Greyhound buses in the US – came just days after National Express agreed a deal with its banks to delay a tightening of terms related to its loans for six months, as it strives to slash its £1.2bn debt pile.
It has cuts its dividend payments and slashed 750 jobs in the economic downturn.
National Express is also understood to be considering a £400m rights issue.
The firm was last night unavailable for comment.