National in board row with investor

American hedge fund Elliott, which has been lobbying National Express to consider a sale or break-up of the business, is proposing three non-executive directors for election at the company’s annual shareholder meeting next month.

National Express called on its shareholders to reject the resolutions and said it was already working on plans to appoint additional non-executive directors to represent the interests of all investors.

Elliott, which has an interest in 17 per cent of the coach and bus operator, needs 50 per cent of votes from shareholders to be in favour of the resolutions at the meeting next month. It is not known whether it has the support of Spain’s Cosmen family, the group’s largest shareholder.

In a letter to shareholders, Elliott said its candidates for the board would provide “fresh impetus and thinking” and believes the company should be more pro-active in its assessment of potential deals.

In the wake of Deutsche Bahn’s acquisition of Arriva, it is thought potential merger partners could include Stagecoach or FirstGroup in the UK and France’s SNCF.

Elliott, which bought most of its stake in a fundraising by National following the loss of its East Coast rail franchise in 2009, said it was impressed by the recent turnaround of the business.

However, it still plans to vote against the re-election of current director Roger Devlin in a shake-up that would also see the appointment of banker Javier Canosa, entrepreneur Marc Meyohas and former Swissair logistics boss Chris Muntwyler.