FirstGroup has moved to boost its presence in the north of England with the acquisition of York Pullman Bus Company.

The Aberdeen-based transport giant declared the proposed deal will enhance the operational footprint of its First Bus division in North Yorkshire and provide profitable growth opportunities in adjacent services markets, along with the ability to move into other locations across the UK.

With a fleet of more than 130 vehicles with varying passenger capacity, York Pullman is described as a “high-performing” business comprising five “well-established” coach services brands. It provides home-to-school and college-contracted services, and private hire operations such as rail replacement services. It also operates a small number of local bus routes on behalf of several local authorities, said to be complementary to First Bus operations in York.

York Pullman reported revenues of around £10 million and earnings before interest and tax of about £2m for the year ended December 31, 2022.

FirstGroup said managing director Tom James will remain with the company in his current role and continue to run York Pullman on a standalone basis. It said he will also contribute to the development of the First Bus coach services growth strategy, highlighting synergy benefits and support from the First Bus executive team.

FirstGroup chief executive Graham Sutherland said: “A key pillar of our strategy is to grow and diversify our portfolio. The acquisition of York Pullman, a long-established, high-performing business fits well with our strategy as it will both enhance the First Bus operational footprint in North Yorkshire and expand our adjacent services business, where we are looking to grow our presence.”

The acquisition remains subject to regulatory approval.

FirstGroup noted that, on completion of the deal, it anticipates a year-end, adjusted net cash position of £60m-£70m for 2024, with around £30m of its ongoing share buyback programme still be completed.