Custom Coaches sold


UK bus builder Alexander Dennis Limited has bought iconic Australian manufacturer Custom Coaches

Custom Coaches sold
Custom Coaches sold

By David Goeldner | June 7, 2012

United Kingdom bus builder Alexander Dennis Limited today announced it has bought the entire issued share capital of Custom Coaches.

"We’ve bought the whole business," ADL CEO Colin Robertson confirms.

The acquisition takes effect from June 6 and there will not be any branding or name change of the Custom Coaches' business.

"The existing shareholders are retiring, but will be retained on short term consulting contracts to help manage the transition in an orderly and professional way," Robertson says.

Robertson is in Sydney this month to sign off on the acquisition, and will soon travel to Adelaide and Melbourne.

For the first seven weeks under new management, the Australian business will be led by ADL’s Asia-Pacific General Manager Paul Davis, who is based in Hong Kong, until a local boss is appointed to replace retiring CEO and former shareholder Mark Burgess.

"Paul will be on the ground in Australia working with the management team, getting to know the business and understanding what it needs in terms of help and support," Robertson says.

Robertson revealed he had been talking to Burgess since the start of the year about a possible sale.

"Australia has always been on our radar, and at the very start of this year Mark intimated that Custom’s shareholders may want to consider what they do with the rest of their lives, and from there we started the discussion of potential acquisition of Custom by ADL," says Robertson.

Robertson doesn’t see widespread concerns about Australia’s recession-entering economic conditions as impacting upon the sale and future direction of the iconic Australian bus builder.

"From our standpoint we see the Australian economy as continuing to evolve and grow over time," he says.

"When you start looking at strategic options for a company like Alexander Dennis, then Australia ticks the box – there is no doubt about that."

Robertson says the Custom Coaches acquisition is a big event for ADL.

"Alexander Dennis is a private company and we are enjoying a new level of success in the UK and our international markets, such as south-east Asia in Hong Kong and in North America," he says.

Robertson expects few changes at Custom Coaches in the short term.

"Until we get our feet under the table over the next few days and weeks, then I don’t know how the organisation structure will evolve other than we do have a very strong and capable team running the business here in Australia," he says.

Robertson will also be out and about meeting local chassis suppliers and key clients.

"We work very well with Scania, Volvo, MAN and Mercedes-Benz in the UK, and we don’t foresee any difference whatsoever continuing to work with our global chassis partners here in the Australian market."

As for the terms of the sale, Robertson says he was bound by a confidentiality agreement as are the sellers, not to discuss the price.

"Even if I wanted to answer that question I couldn’t," he says.

He says Custom is a private company now formally owned by three shareholders, and ADL is a private company owned by five shareholders, of which Robertson is one of the shareholders.

"I like to think that we negotiated a fair price because we didn’t need to buy and these guys didn’t need to sell," he says.

"Being a significant shareholder myself – and being Scottish – I would have to say that we did bargain hard, and we reached a price that both buyer and seller were happy with.

"This is a very significant deal for us, and I will be here (in Australia) for the next two weeks."



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