HOUSTON -- Industry officials said the acquisition of Coach USA,
the largest provider of motorcoach, airport shuttle and taxi
services in North America, by Stagecoach, a Perth, Scotland-based
operator of buses in Europe and Asia, will bode well for tour
operators and the motorcoach industry in general.
As reported, Stagecoach said it plans to acquire Coach USA for
about $1.8 billion. Stagecoach said it will keep the Coach USA
management team in place.
Tour operator Keith Griffall, president of Western Leisure in
Salt Lake City and the National Tour Association's immediate past
president, said the retention of the management team is important
because tour operators rely on managers at "the local level in your
town" to provide good customer service.
"As the original owners of small motorcoach companies [acquired
by Coach USA] retire, the general managers of Coach will have to
keep that level of customer service to retain the charter
motorcoach market, and that's a challenge for a company that size,"
Griffall said.
American Bus Association president Peter Pantuso said the move
into North America's charter and tour industry by a successful
international transportation company is "a vote of confidence for
the motorcoach industry."
The two companies signed a definitive merger agreement in which
Stagecoach will acquire all of the outstanding common stock of
Coach at a price of $42 per share. A tender offer for all
outstanding shares was expected to begin on June 18, the companies
said.
Brian Souter, chairman of Stagecoach, said the deal enables the
company to reach its goal of entering the North American market at
"a relatively early stage in consolidation, with the prospect of
exciting growth opportunities," because Coach USA has built a
strong position and brand in North America.
"The two companies share a background of successful growth by
acquisition, and we have found a high degree of compatibility
between the two management teams," he said.
Larry King, chairman and chief executive officer of Coach, said
Stagecoach can provide the "financial flexibility and resources to
support our next growth phase."
Stagecoach operates in the U.K., New Zealand, Sweden, Finland,
Portugal, Australia and China, with associated undertakings in
railways in the U.K. and toll roads in China.