National Express completes £125m US acquisition
BIRMINGHAM-based transport group National Express has announced the £126m ($200m) acquisition of America’s fifth largest provider of student transport services.
It said the takeover of Petermann Partners was expected to be earnings accretive from the outset and strengthened the group’s position in a key US market.
The deal deflects attention away from the news that the group’s head of UK bus operations Dave Kaye has quit the business after less than a year in post.
Petermann is the market leader in its home state, Ohio, and has operations across 10 states in the Midwest, West and Southwest. The acquisition adds more than 3,300 vehicles and increases the size of the US fleet by 20%.
National Express said the deal, which is expected to complete in the fourth quarter, was funded through a combination of cash and existing credit facilities.
For the fiscal year ending June 30, 2011, Petermann generated revenue of £94.4m ($149.9m) with normalised EBITDA of £18.4m ($29.3m), normalised operating profit of £8.5m ($13.5m) and had gross assets at June 30, 2011 of £160m ($254.5m).
National Express said the acquisition of Petermann represented a targeted expansion by the group in the structurally attractive US student transportation market. Since being founded in 1999, Petermann has developed a strong track record of growth, driven by new contract wins and bolt-on acquisitions.
Dean Finch, Group Chief Executive of National Express, said: “We are delighted to acquire such a high quality business in Petermann. Our recent improved performance has enabled us to take advantage of this opportunity.
“It’s a great strategic fit for our existing school bus business, complementing our current operations, introducing us to new states and giving us a foothold in the paratransit market. This is an important step in delivering our strategy of growth in North America.”
