Image source: Shutterstock

Highlights:

  • MCG expects School Bus sale to I Squared Capital to close in July 2025 pending final approval.
  • Mobico maintains FY25 adjusted operating profit forecast between GBP 180 million and GBP 195 million.
  • The Group anticipates USD 365–385 million in upfront net proceeds from the divestment.

Mobico Group PLC (LSE:MCG) is a UK-based international transport provider operating bus, coach, and rail services. The company serves markets across the UK, Continental Europe, North Africa, and North America. Mobico focuses on providing public and private transport solutions, with an emphasis on safety, operational efficiency, and environmental sustainability.

The company has issued an update on the planned sale of its North America School Bus business and reaffirmed its earnings guidance for FY2025. The company announced that all key regulatory approvals for the GBP 608 million transaction have progressed as expected, with only final clearance from the U.S. Surface Transportation Board (STB) outstanding. The STB has already provided a tentative approval, and Mobico anticipates that this will be made final in early July 2025.

Assuming the approval proceeds on schedule, Mobico expects the transaction to be completed during the month of July. The group estimates upfront net proceeds from the sale to be in the range of USD 365 million to USD 385 million (approximately GBP 275 million to GBP 290 million), with the final figure to be confirmed upon closing.

The divestment was first announced on 25 April 2025 and involves the sale of Mobico’s North America School Bus operations to I Squared Capital, a global infrastructure investment manager. The deal structure includes an enterprise value of up to USD 608 million, and the anticipated proceeds will provide additional flexibility for the group’s capital position.

Mobico stated that it will provide an update on cash flow and leverage following the completion of the transaction. The company currently holds adequate liquidity and confirmed it has no significant debt maturities due until the second half of 2027. The expected cash inflow from the School Bus divestiture is projected to cover these future obligations.

The company also used the opportunity to clarify its financial outlook for FY2025. Excluding any contribution from the School Bus business for the period it remains under Mobico’s ownership in 2025, the group continues to expect its adjusted operating profit to range between GBP 180 million and GBP 195 million. This guidance remains unchanged and reflects the anticipated performance of the ongoing operations post-divestiture.

Mobico has been actively reviewing its portfolio to align with long-term strategic priorities and improve capital allocation. The decision to divest the School Bus segment follows a broader effort to focus on core geographies and business models with sustainable growth potential. While the North American School Bus operation has been a longstanding part of the group, the sale marks a shift towards streamlining its portfolio.

Mobico has not disclosed specific plans for the use of proceeds beyond managing debt maturities. However, the cash injection from the sale enhances financial headroom and may provide optionality for future investment or shareholder return strategies, pending board decisions post-completion.

MCG shares were trading 2.29% higher at GBX 26.84 per share as of 24 June 2025.