EXCLUSIVE: The complex sale of major bus entity the Donric Group – which split the assets for two buyers in a minimum AUD$100 Million deal across multiple states – successfully concluded the second-biggest bus M&A (mergers and acquisitions) of the year, according to Pitcher Partners - the commercial advisor leading the transaction.
The 40-year-old Donric Group essentially comprised six long-established regional brands: Sunbury Coaches and Sunbury Bus Service, Coach Tours of Australia, and Organ’s Coaches Kyneton in Victoria plus Trans North Bus & Coach and Bowen Transit in Queensland.
The business had grown from a small fleet of eight school buses to more than 400 buses, 210 contracts and 16 depots in the two states, it’s reported.
Pitcher Partners partner Michael Sonego says the sale was complex given a break-up of the business was chosen to maximise and optimise the return for the shareholders.
INCREASED ACTIVITY
One of the original shareholders has bought part of Donric Group’s Victorian operation, covering the Calder Freeway, as well as the Queensland operations, while the remainder of the business was sold to Christian’s Bus Co, a Victorian-based bus company.
Sonego says the sale represented the second-largest bus deal of the year, but he anticipated an increase in activity in the sector.
“Throughout Australia over the past 12 months most bus contracts have come up for renewal, so most jurisdictions will now be on a fresh contract,” he said.
“Those contracts have many years to run, which normally leads to increased activity with buyers having the confidence of known contract tenure and margin.”
Sonego adds that the transaction enabled the two ‘exiting’ shareholders to realise their investment from a business in which they and their families were no longer actively involved in day-to-day management while enabling the remaining family to continue in the industry.
ABOUT PITCHER PARTNERS
Pitcher Partners is a national association of independent firms. The association is represented by Pitcher Partners Melbourne, Pitcher Partners Sydney, Pitcher Partners Perth, Pitcher Partners Adelaide, Pitcher Partners Brisbane and Pitcher Partners Newcastle, it states.
The Pitcher Partners national association is also an independent member of Baker Tilly International. Each firm operates as a separate independent business, but with a shared commitment to common values including providing exceptional client service, technical expertise, rigorous and practical commercial advice and a caring working environment, it explains.
The firms work together to ensure clients receive the highest levels of service and advice, no matter where they are located, it states.
Photography: courtesy Donric Group