Acquisition

22 May 2003

                                FIRSTGROUP PLC                                 

                            US TRANSIT ACQUISITION                             

FirstGroup plc is pleased to announce that it has agreed terms under which its
North American transit division, will purchase the operational assets of Coach
USA's transit division, a wholly owned subsidiary of Stagecoach Group plc, for
a purchase price of US$22.5 million.

The business to be acquired has annualised turnover of US$95 million. Assets
include operational contracts from Coach USA's transit division. The business
has contracts to operate some 1,200 buses on behalf of transit authorities and
other bodies in states such as California, Florida and New York and employs
some 2,000 staff.

The transaction is conditional on, among other things, approval from affected
public authorities.

Commenting, Iain Lanaghan, Finance Director said: 'This is an excellent
strategic fit with our existing transit operations in the US and continues our
successful programme of in-fill acquisitions at attractive multiples. Across
our three North American divisions, First Student, First Transit and First
Services we are continuing to grow by winning new business and making
acquisitions.'

Contact:

Iain Lanaghan, Finance Director 020 7291 0510

Michael Mitchell, Corporate Communications Director 020 7291 0504

Notes to editors:

FirstGroup plc is a UK based international transport company with a turnover of
more than £2 billion a year, and 57,000 employees throughout the UK and North
America.

  * The Group is Britain's largest bus operator running more than one in five
    of all local bus services. A fleet of some 9,500 buses carries 2.7 million
    passengers a day in more than 40 towns and cities.
   
  * The Group is also one of the UK's largest rail operators with three
    franchises - First Great Western, First Great Eastern and First North
    Western. It is introducing new trains in each franchise at a cost of more
    than £200 million. The group operates nearly one-fifth of the UK passenger
    rail network, with a balanced portfolio of inter-city, London commuter, and
    regional services.
   
  * It holds the operating contract for the Croydon Tramlink network, which
    carries over 20 million passengers a year.
   
  * In North America the Group has three operating divisions: Yellow School
    Buses (First Student), Transit Contracting and Management Services (First
    Transit) and Vehicle Maintenance and ancillary services (First Services).
    Headquartered in Cincinnati the businesses operate across the US and
    Canada.
   
  * 
      + First Student is the second largest provider of Yellow school buses in
        the USA and the third largest in Canada. With a fleet of some 15,500
        school buses it transports nearly one million students everyday.
       
      + First Transit is one of the largest private sector providers of urban
        bus services in the US, managing public transport systems on behalf of
        cities such as Houston, Dallas and Denver.
       
      + First Services is the largest private sector provider of vehicle
        maintenance in the US. Maintaining fleets and equipment for primarily
        public sector customers such as cities, counties, fire and police
        departments