Sir Brian Souter sells New Zealand bus interests

The family investment vehicle of Stagecoach Group co-founder Sir Brian Souter has struck a deal to sell two bus businesses in New Zealand.

Tuesday, 20th August 2019, 6:55 pm
Souter is the co-founder of Perth transport giant Stagecoach. Picture: Robert Perry.

The agreement to sell Howick and Eastern Buses and Mana Coach Services to France’s Transdev for an undisclosed sum marks the fourth major disposal by Edinburgh-based Souter Investments since May following the sales of Scottish bus builder Alexander Dennis, investment administration firm Mobius Life and perfume brand Clive Christian.

Howick and Eastern Buses has a fleet of 145 vehicles and currently operates 23 routes on behalf of Auckland Transport. Mana’s fleet of 66 buses operates services on behalf of the Greater Wellington Regional Council. Both companies also provide school bus and charter services. The transaction is subject to regulatory approval.

Souter Investments acquired Mana Coach Services in 2007 and added Howick and Eastern Buses a year later. It said that during its ownership it had invested heavily in new vehicles and the businesses has handled 95 million customer journeys.

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John Berthinussen, investment director at Souter Investments, said: “Souter Investments has a long history of operating and investing in New Zealand, which is an attractive and easy place to do business, and where there are supportive environmental, demographic and economic conditions for growth in sustainable public transport.”

Bill Rae, outgoing chairman of Howick and Eastern Buses and Mana Coach Services, said: “Both Howick and Eastern Buses and Mana Coach Services are recognised as industry-leading urban bus operators, with first-class operational capabilities and strong long-term relationships with key stakeholders.

“Following significant capital investment and under the leadership of Sheryll Otway and Craig Chin, both Howick and Eastern Buses and Mana Coach Services are well-placed to continue playing a central role in the growth of sustainable, environmentally friendly public transport in Auckland and Wellington, New Zealand’s two largest public transport markets.”

Elsewhere in New Zealand, Souter Investments owns Fullers360, which provides ferry and tourism services on Auckland Harbour and the Hauraki Gulf.

Transdev Australasia chief executive Luke Agati said that the acquisitions provide a “great opportunity” to strengthen public transport connections in New Zealand’s two biggest cities where Transdev has existing rail operations.

Bancorp Corporate Finance acted as lead financial advisers for Souter Investments, Minter Ellison Rudd Watts as legal advisers and KPMG provided tax advice. Deloitte provided vendor due diligence services.

In May Alexander Dennis, of which Souter Investments owned around half, was acquired by Canadian firm NFI Group in a £320 million deal. Earlier that month Souter also announced a deal to sell Mobius Life, a provider of investment administration services to UK pension schemes, to Phoenix Equity Partners.

Last month fragrance house Clive Christian, which Souter Investments had bought a stake in four years ago, was bought by Nichebox.