By Yadarisa Shabong
(Reuters) -FirstGroup’s second-biggest shareholder, Schroders, said on Thursday it planned to vote against the company’s $4.6 billion sale of its North American bus businesses to private equity firm EQT, joining top investor Coast Capital in opposing the deal.
The move comes after activist hedge fund Coast Capital asked other FirstGroup investors to vote against the proposed sale of the “crown jewel assets,” unless the offer was improved.
“We have the intention of voting against the deal as it stands, as we believe it undervalues these businesses,” a Schroders spokesperson said in an emailed statement.
FirstGroup said on Tuesday it “followed a comprehensive and competitive process in order to seek the best possible price” for the assets.
The deal has the backing of Columbia Threadneedle Investments, FirstGroup’s third-largest shareholder with a stake of around 10%.
The company will hold a general meeting on May 27 to vote on the proposed deal.
Schroder Investment Management owns nearly 12% of FirstGroup, while Coast Capital owns nearly 14%, Refinitiv Eikon data showed.
(Reporting by Yadarisa Shabong in Bengaluru; Editing by Aditya Soni)