Bus and coach operator makes £2m acquisition from city rival

Rotala

Sandwell bus and coach operator Rotala has turned to its Birmingham-based rival, National Express, as it looks to expand its UK operations.

Tividale-based Rotala has reached an agreement with National Express to acquire its Hotel Hoppa business in a deal valued at £2m.

Hotel Hoppa comprises a passenger transport service between Heathrow Airport (all terminals) and hotels within a five-mile radius of Heathrow Central Bus Station, delivered under contracts with those hotels and other airline customers.

The acquisition includes the right to use the business name, the goodwill of the business and the novation of the underlying contracts, together with the fleet of 32 buses.

The £2m will be payable in full on completion of the deal. The money is being drawn from Rotala’s existing cash resources following a £3.5m fundraising this summer.

In an announcement to the markets, Rotala said: “The directors believe the Hotel Hoppa acquisition will enable Rotala to strengthen significantly its operations in the Heathrow area. Many of the airline customers of the Hotel Hoppa business are already users of various airside and landside services provided to them by Rotala in and around the airport.

“No additional overheads are expected to be required as a result of the acquisition since the acquired business will utilise spare capacity in the existing Rotala depots on the southern side of Heathrow Airport.

“The directors believe that the company will benefit, in the first full year following completion of the acquisition, from additional sales, EBITDA and profit before tax contributions of approximately £6m, £0.5m and £0.2m respectively.

Completion is expected to occur towards the end of November 2017.

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