Agreement to Take 20% Interest in Prepayment Cards

FirstGroup PLC 23 December 1999 FirstGroup Joins Prepayment Cards Limited and Commits to Smart Card Roll-out FirstGroup plc, one of the largest UK and international bus operators, today announced that it had agreed to acquire a 20% interest in Prepayment Cards Limited (PCL) from ERG Limited (ERG). PCL is the joint venture company established by ERG, Stagecoach Holdings plc and Sema Group UK Ltd in September 1999 (refer Media Release of 23 September 1999). PCL will provide a smart card issuing and clearing system that enables UK-wide transport operators and passenger transport authorities to meet the UK Government's policy on integrated transport throughout the UK. PCL has the exclusive rights in the UK to ERG's internationally adopted software that enables the issue and management of multi-application smart cards and the operation of fully integrated public transport ticketing. The services of PCL will be made available to all public transport operators and any organisation wishing to issue smart cards thereby sharing infrastructure and lowering the costs of operating smart card technology. FirstGroup will roll out smart cards across its bus fleet in Greater Manchester in the New Year and has already commenced installation of ERG's advanced bus ticketing equipment in Manchester. As part of its investment in PCL, FirstGroup intends to introduce smart card technology progressively across its bus and rail fleets throughout the UK over the next few years. The smart card implementation by FirstGroup will conform to the Government's policy for integrated transport. Mr Moir Lockhead, Chief Executive of FirstGroup, said the purchase of a shareholding in PCL was evidence of FirstGroup's commitment to improve public transport across the UK. 'FirstGroup strongly supports the concept of shared infrastructure across the UK for all transport operators. Through our investment in PCL, alongside other major transport operators and system providers, we will work to achieve the Government's goal of integrated and interoperable ticketing. 'We hope that other operators will use PCL's services to accelerate adoption of smart card across bus and rail transport in the UK.' The roll-out of smart cards in Manchester by FirstGroup will work alongside the smart card scheme to be issued to all concessionary passengers in Greater Manchester by PCL on behalf of the Greater Manchester Passenger Transport Executive. The adoption of smart cards by FirstGroup will further increase the base of cards issued through and managed by PCL. Mr Peter Fogarty, Chairman of PCL and Chief Executive of ERG, welcomed FirstGroup as a new shareholder of PCL. 'We have now succeeded in having the two largest transport operators in the UK join PCL as shareholders and users of the PCL System. This is a significant development for the public transport sector in the UK and should greatly assist the Government in achieving its far-sighted vision of integrated and interoperable transport ticketing. 'Negotiations are proceeding with other operators which have expressed a strong desire to use the PCL services.' Mike Kinski, Group Chief Executive of Stagecoach Holdings plc, one of the original founders of PCL, welcomed the news that FirstGroup plc was acquiring an interest in this very exciting venture. The PCL network will allow the public to use smart card technology in place of traditional transport tickets. The smart cards can be personalised or anonymous, and can be reloaded with cash or ticket types. They will also give the passenger access to discounts and other services outside transport. The services of PCL will be available to any transport operators or other organisations working to issue cards on the same terms as the PCL shareholders. BACKGROUND INFORMATION Prepayment Cards Limited (PCL) PCL is a joint company of ERG Limited, Sema Group UK Ltd, Stagecoach Holdings plc and FirstGroup plc. ERG is registered as the owner of 50% of PCL; Stagecoach 20%; Sema 10%, with an option over a further 10%; and FirstGroup 20% (on completion of its agreement). PCL, through its subsidiary PCML, has an agreement with the Greater Manchester Passenger Transport Executive to operate the Greater Manchester concessionary fare collection System. FirstGroup plc FirstGroup operates some 10,000 buses in the UK through 30 subsidiary companies. It is also responsible for First Great Western, First Great Eastern and First North Western train franchises. The Group also has a 51% stake in Bristol International Airport. It is a 26% shareholder in New World First Bus, responsible for the operation of over 800 buses in Hong Kong and as First Group America operates some 10,000 school buses throughout the USA. The Group's turnover is currently running at £2 billion per annum. ERG Group The ERG Group is a world leader in the development and supply of technologically advanced smart card systems and services, automated fare collection products and systems, and telecommunications products and services. ERG provides turnkey solutions to customers, from design and manufacture to supply, installation, commissioning and ongoing service and maintenance. ERG is listed on the Australian Stock Exchange and ranks in the top 100 companies. It is capitalised at over $A1.6 billion. Sema Group plc Sema Group is one of the world's leading IT and business services companies with more than 18,000 employees across Europe, Asia and the Americas. The Group's main business activities are consulting, systems integration, outsourcing and specialist software; particularly in the key sectors of finance, telecommunications, transport, the public sector, industry and energy. The Group is listed on both the London and Paris stock exchanges. In 1998 Sema Group's turnover reached £1.25 billion. Stagecoach Holdings plc Stagecoach Holdings plc is a provider of public transport services in the UK and overseas. In the UK it is one of the largest bus operators with a fleet of over 7,400 buses. Other public transport interests include rail services, a rolling stock leasing company and aviation services. Stagecoach also owns bus and operations in the United States, Hong Kong, Australia, New Zealand, Sweden, Finland and Portugal. In April 1993 the Company was floated on the London Stock Exchange and today has a market capitalisation in excess of £2.7 billion.

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