Stagecoach has revealed that it is recommending an acquisition by investor DWS Infrastructure for 105p a share in cash and has withdrawn support for the National Express bid, which valued Stagecoach at around £437m.

The National Express and Stagecoach merger, which was agreed in December last year, is currently being investigated by the Competition and Markets Authority, which served an initial enforcement order in January preventing the two travel firms from combining operations or selling any UK businesses while it probes the deal.

Stagecoach said the DWS bid will provide greater certainty for investors and employees, with an overall headcount in frontline operational roles expected to stay the same, as well as the retention of Stagecoach’s existing headquarter functions, The Insider reports.

Martin Griffiths, chief executive of Stagecoach, said: “The proposed offer presents a major opportunity to maximise the significant growth potential ahead as governments seek to deliver economic recovery, level up communities, provide better health outcomes for citizens, and transition to a net zero future.

“We believe it will open a new and exciting chapter for Stagecoach, backed by a team who share our vision for a more sustainable future.”