Shares in the public transport group National Express are speeding away today – up 18% at one point.
The shares have gained more than 50% in the past three days amid feverish speculation that the government could step in and change the terms of its East Coast franchise.
Alternatively, the group could become the subject of a bid or sell some of its opeartions, so the rumours go.
National Express shares were changing hands above £10 as recently as September but have spiralled downwards in recent months to hit a closing low of 151.75p on Tuesday night.
Then on Wednesday they put on 23% and ticked up again yesterday after the appointment of a new chairman, John Devaney.
Investors were also cheered by the Department for Transport's decision to allow the company to increase capacity on its East Anglian franchise by 188 carriages.
Today the shares leapt 18% to touch 232p, before subsiding to 223.5p.
In February, the group reported its full-year results and revealed that it would slash dividends and probably axe more jobs on top of 750 redundancies already announced, to prevent it having to hand back its three rail franchises, which also include the contract for services running out of Fenchurch Street to the Esex coast.
Its agreement to pay the government £1.4bn over seven-and-a-half years for the East Coast contract now looks onerous.
The company's franchise payments to the government are set to rise from £85m last year to £395m by 2015.
So far the company – which is also saddled with a debt burden of £1.2bn – has not secured any help from the government.
