National Express in Spanish deal

The deal makes National Express a major transport provider in Spain

UK-based rail and coach firm National Express has announced it is buying Spanish transport group Continental Auto for £449.7m ($894.4m).

National Express has been expanding its presence in Spain, and bought another transport company, Alsa, in 2005.

When the latest deal is completed, National Express will operate more than 2,100 vehicles in Spain, carrying more than 142 million passengers a year.

The takeover is expected to be completed by the end of 2007.

This transaction will reinforce our position as a leading provider in the Spanish public transport market Richard Bowker, National Express chief executive National Express share price

News of the deal came as National Express issued a trading update in which it said it had made a "strong" start to the year, and that trading was in line with expectations.

'Quality business'

Continental Auto operates a fleet of 860 buses and coaches in Spain, and also has freight and rail operations in the country.

"Continental Auto is a quality business and we are delighted that it will join the group," said National Express's chief executive Richard Bowker.

"This transaction will reinforce our position as a leading provider in the Spanish public transport market."

Spain has one of the fastest growing public transport markets in Europe and is set to liberalise transport in its main cities.

National Express carries more than one billion passengers a year worldwide on its bus and rail operations in the UK, US and Spain.