LONDON (Reuters) -British transport company National Express is in talks to acquire rival operator Stagecoach Group in an all-share deal, which would result in cost savings and provide new growth opportunities for the companies.

National Express operates bus and coach services in Spain, the United States and Germany, as well as running school buses in those countries. Stagecoach’s focus is on Britain where it is the largest bus and coach operator.

Stagecoach shareholders could receive 0.36 National Express shares in exchange for every Stagecoach Share. They would also have a 25% share of the newly merged company.

This would put Stagecoach’s value at approximately 445 million pounds (609 million dollars), which is 18% more than the Monday closing price.

Both companies stated that negotiations and due diligence were continuing and that there was no guarantee that a formal deal would be reached.

If a deal is reached, Stagecoach’s Chairman Ray O’Toole (a former Chief Operating Officer at National Express) would take over as chair. National Express’ chief executive Ignacio Garat will continue to be the CEO of the combined entity.

($1 = 0.7310 pounds)