Flights Coaches group makes £3m acquisition
BIRMINGHAM-based transport group Rotala has acquired Preston Bus Ltd in a £3.2m deal from rival Stagecoach.
Rotala, which operates the Flights airport coaches, said it believed the acquisition would enhance earnings in the current financial year.
Stagecoach put PBL up for sale following an investigation by the Competition Commission. Rotala has emerged as the successful bidder in the sale process.
PBL runs a fleet of 85 vehicles, operating in and around Preston and adjacent areas. The services are predominately local, providing about 10 million passenger journeys a year. PBL has about 240 employees and operates from a freehold operating and engineering depot in Preston.
The services are largely operated on a commercial basis in a deregulated market. PBL also carries out a number of tendered services, including school contracts, on behalf of local authorities and other public bodies.
The offer for PBL was made on a debt free basis. The board of Rotala estimates the net book value of the assets being acquired is approximately £3m, with the principal operating assets omprising the fleet and depot.
For the year ended April 30, 2010, PBL’s turnover was £7.75m with a pre-tax loss of £132,000. For the year ending April 30, 2011, the management of PBL had forecast revenue of £9.5m.
The acquisition is being financed by a hire purchase facility, secured on the vehicles owned by PBL, of £2.4m, a bridging loan from the group’s bankers of £617,500 and the remainder from the existing banking facilities of the group. The bridging loan is repayable in two tranches, one of £460,000 by February 28, 2011 and one of £157,500 by May 28, 2011.
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