The Competition and Markets Authority (CMA) on Wednesday (26 January) served an initial enforcement order (IEO), effectively putting the brakes on the deal agreed in December, which would create a group pushing £2 billion in value.

In effect, the order prevents the two firms from embarking on any activity that would amount to embarking on a merger while the CMA investigates the deal.

In a note to the stock exchange, Stagecoach said the intervention would prevent either National Express or Stagecoach disposing of any material UK assets at this time.

"The IEO will therefore delay completion of the proposed sale of the marketing, retail and customer service activities of Stagecoach’s inter-city coach businesses," said the firm.

The two companies’ boards said they were confident the proposal wouldn’t create any competition worries and pledged to work with the CMA to allow them to complete as soon as possible.

Both remain hopeful, too, of completing the merger by the end of the year once the deal is okayed by the CMA. "At this stage, the boards of National Express and Stagecoach continue to expect the combination to complete around the end of 2022."

The all-share merger will create a group worth nearly £2 billion with a fleet of some 40,000 vehicles and a workforce of around 70,000. National Express shareholders would hold a 75% stake in the new entity, and Stagecoach’s 25%.