Cosmen clan snubs cash call at National Express

NATIONAL EXPRESS, the struggling transport company, announced plans to raise &pound;360m via a rights issue yesterday &ndash; but its main shareholder objected to the plans.<br /><br />The cash fetched from the fundraising will be used to shore up the group&rsquo;s balance sheet and pay off its debt pile, after the rail and bus company snubbed takeover approaches.<br /><br />Jorge Cosmen, who represents 18 per cent shareholder the Cosmen family, voted against the rights issue, saying he did not feel it was in the best interests of the company. <br /><br />The Cosmens had backed the takeover attempts from rival First Group and a consortium including Stagecoach and private equity house CVC Capital.<br /><br />The family could lose their seat on the board if they do not support the&nbsp; cash call, but chief operating officer Ray O&rsquo;Toole has given them two-and-a-half weeks to change its mind.<br /><br />The Cosmen family backs a rights issue in theory, but said that the cash call &ndash;&ensp;which would cost it &pound;65m &ndash; was more than it was prepared to pay. <br /><br />The rights issue comes at the end of a shaky year for National Express, whose chief executive Richard Bowker quit when the firm was stripped of its&nbsp; East Coast rail line because it defaulted on franchise payments to the government.<br /><br /><strong>SIMON MACKENZIE-SMITH BOA MERRILL LYNCH</strong><br />THE long-awaited National Express rights issue is fully underwritten by Bank of America Merrill Lynch, Morgan Stanley, Barclays Capital, RBS Hoare Govett, BBVA, BNP Paribas, Commerzbank and HSBC.<br /><br />BoA Merrill Lynch&rsquo;s group, led by Simon Mackenzie-Smith, and Morgan Stanley&rsquo;s team, headed up by Matthew Jarman, are joint lead-underwriters to the deal. <br /><br />Prolific dealmaker Mackenzie-Smith, who joined Merrill in 1996, was instrumental in establishing the bank&rsquo;s UK arm, and has been involved in a wide range of mergers and acquisitions and restructurings, including the Punch Taverns fundraising earlier this year.