New owners for Strathtay & Meffans
It's been something every day this week. Yesterday someone was due to be leaving work, but turned out she'd been and gone on Wednesday. Anyway, today's early morning (my time!) announcement was Strathtay and Meffan's parent company Traction Group Limited being taken over by Stagecoach, effective 2am this morning. As a result, changes are expected in the first quarter of 2006, but not immediatly.
Acquisition of Traction Group Limited
15/12/2005
Stagecoach Group plc (“Stagecoach”) is pleased to announce that on 14 December 2005, it completed the acquisition of the entire share capital of Traction Group Limited (“Traction”). The principal vendors are Mr Frank Carter, (who prior to the acquisition was Chairman and Managing Director of Traction), two trusts in favour of members of Mr Frank Carter’s family and a Traction employee share ownership trust.
Traction is the sixth largest operator of bus services in the UK and is the largest operator that was still privately owned. Traction’s operations are centred on South and West Yorkshire, Lincolnshire and Tayside. In its financial year ended 31 December 2004, Traction reported turnover of £56.6million, operating profit of £2.5 million and gross assets of £50.5million.
The consideration paid for the shares was approximately £26.0million, which was satisfied by £21.5million in cash and the issue of 4,022,070 Stagecoach ordinary shares of 12/19th pence each. Stagecoach has assumed Traction’s net debt of approximately £11.0million. The consolidated net debt of Stagecoach will therefore increase by approximately £32.5million as a result of the acquisition.
Application has been made to the London Stock Exchange and UK Listing Authority for the admission to the Official List of the new ordinary shares and listing is expected to become effective on 16 December 2005. The new ordinary shares will rank pari passu with the existing ordinary shares.
Brian Souter, Chief Executive of Stagecoach Group plc, commented: “The acquisition of Traction is consistent with our strategy for growth in our core UK and North American markets, and follows the acquisition of Glenvale Transport earlier this year.
“Traction is the largest of the remaining privately-owned UK bus operators. We are excited by the prospects of acquiring Traction, and believe we can add value through innovation, investment and by applying Stagecoach’s operational expertise.
“Stagecoach’s investment in improved services and initiatives - including Kickstart, sector-leading telemarketing campaigns and online sales - is seeing large numbers of people return to the nation’s buses and demonstrates our ability to deliver impressive growth."
In the recently reported Stagecoach Group results for the six months ended 31 October 2005, revenue in the UK Bus division was up 10.5%.
ENDS
15/12/2005
Stagecoach Group plc (“Stagecoach”) is pleased to announce that on 14 December 2005, it completed the acquisition of the entire share capital of Traction Group Limited (“Traction”). The principal vendors are Mr Frank Carter, (who prior to the acquisition was Chairman and Managing Director of Traction), two trusts in favour of members of Mr Frank Carter’s family and a Traction employee share ownership trust.
Traction is the sixth largest operator of bus services in the UK and is the largest operator that was still privately owned. Traction’s operations are centred on South and West Yorkshire, Lincolnshire and Tayside. In its financial year ended 31 December 2004, Traction reported turnover of £56.6million, operating profit of £2.5 million and gross assets of £50.5million.
The consideration paid for the shares was approximately £26.0million, which was satisfied by £21.5million in cash and the issue of 4,022,070 Stagecoach ordinary shares of 12/19th pence each. Stagecoach has assumed Traction’s net debt of approximately £11.0million. The consolidated net debt of Stagecoach will therefore increase by approximately £32.5million as a result of the acquisition.
Application has been made to the London Stock Exchange and UK Listing Authority for the admission to the Official List of the new ordinary shares and listing is expected to become effective on 16 December 2005. The new ordinary shares will rank pari passu with the existing ordinary shares.
Brian Souter, Chief Executive of Stagecoach Group plc, commented: “The acquisition of Traction is consistent with our strategy for growth in our core UK and North American markets, and follows the acquisition of Glenvale Transport earlier this year.
“Traction is the largest of the remaining privately-owned UK bus operators. We are excited by the prospects of acquiring Traction, and believe we can add value through innovation, investment and by applying Stagecoach’s operational expertise.
“Stagecoach’s investment in improved services and initiatives - including Kickstart, sector-leading telemarketing campaigns and online sales - is seeing large numbers of people return to the nation’s buses and demonstrates our ability to deliver impressive growth."
In the recently reported Stagecoach Group results for the six months ended 31 October 2005, revenue in the UK Bus division was up 10.5%.
ENDS
By this evening, the Tully had got this to say...
15 December 2005
Stagecoach takes over Strathtay buses
Perth-based Stagecoach has bought out Strathtay Scottish buses, who operate throughout Tayside and parts of Fife, as part of a £26 million deal, writes Stefan Morkis.
Staff at the Dundee base for Strathtay, part of Traction Group Ltd, only discovered they had new employers when they arrived at work today and found notices announcing the sale pinned to the wall.
One employee said the entire workforce had been shocked by yesterday’s takeover.
“Nobody had any idea this was happening. It has come completely out of the blue,” he said.
The takeover prompted fears amongst staff that it could lead to job losses, although this was refuted by Stagecoach today, who said it planned to invest in and further develop the Strathtay network.
A spokesman said, “We are retaining the local management team and, obviously, the frontline staff will continue in place.
“We see a lot of potential to develop the Traction business, including the services operated by Strathtay.
“Stagecoach has had a lot of success in attracting more people to bus travel as a result of improved telemarketing and we have a good record of investment,” he added.
Traction was the sixth largest bus operator in the UK, with operations in South and West Yorkshire and Lincolnshire.
In its financial year ending December 21, 2004, Traction reported a turnover of £56.6 million, an operating profit of £2.5 million and gross assets of £50.5 million.
The deal is worth £26 million, £21.5 million of which was paid in cash and the remainder by the issue of 4,022,070 Stagecoach ordinary shares.
Stagecoach has assumed Traction’s net debt of approximately £11 million.
Brian Souter, chief executive of Stagecoach Group plc said, “The acquisition of Traction is consistent with our strategy for growth in our core UK and North American markets, and follows the acquisition of Glenvale Transport earlier this year.
“Traction is the largest of the remaining privately-owned UK bus operators.
“We believe we can add value through innovation, investment and by applying Stagecoach’s operational expertise.
“Stagecoach’s investment in improved services and initiatives — including Kickstart, sector-leading telemarketing campaigns and online sales —is seeing large numbers of people return to the nation’s buses and demonstrates our ability to deliver impressive growth,” he added.
I've done a few leaflets for Strathtay this year - not looking forward to getting my hands all blue (assuming the city ones eventually all go to Stagecoach style pocket leaflets...!)
posted by Suzy Scott @ 21:32
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