National Express and rebel Elliott make peace

By Rob Davies for the Daily Mail
Updated: 03:01 EDT, 10 May 2011

National Express and rebel shareholder Elliott Advisors have called a ceasefire, preventing their spat over strategy from coming to a head at today's annual meeting.

Truce: Elliott's rebellion had divided shareholders

US activist investor and 18% shareholder Elliott has been agitating to install three non-executive directors, in a bid to steer the firm towards expansion in the US or a merger with a European rival.

But 11th-hour peace talks produced an agreement that will see just one of Elliott's nominees, Chris Muntwyler, appointed to the board, along with two more chosen by National Express.

Elliott has also agreed not to voice any further criticism of the management team for a year, just days after chief executive Dean Finch's turnaround strategy saw the firm unveil a 30% jump in first-quarter profit.

In return, National Express (up 1.5p to 259p) is understood to have agreed to update Elliott on its strategic plans on a regular basis. The US firm claims to have had the backing of Spain's Cosmen family, which owns 17.5% of National Express.

But investors including Legal & General, M&G and the Co-op have lined up behind management, suggesting Elliott was headed for a defeat, days after it failed with an attempted coup at pharmaceuticals firm Actelion.