National Express acquires majority stake in Silicon Valley’s premier employee shuttle company
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF EU REGULATION 596/2014.
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF SUCH JURISDICTION.
- Acquisition of 60% stake in WeDriveU, an employee shuttle company serving many of the world’s largest and fastest growing companies in Silicon Valley
Option to acquire remaining shares in tranches over next three years
Earnings accretive from completion of the transaction
Positions National Express as a leader in a fast-growing region and market segment and provides further growth opportunities across North America
Further diversifies our North American operations, with $0.5 billion annualised revenue now generated outside of School Bus
Cash consideration of $84.3 million for an initial 60% equity stake
Transaction multiple of 7 times rolling 12 months EBITDA
National Express Group PLC (“National Express”) is pleased to announce the acquisition (the “Transaction”) of 60 percent of the shares of WeDriveU Holdings Inc. (“WeDriveU”), Silicon Valley’s premier employee shuttle company.
WeDriveU provides employee shuttle services to many of the largest Fortune 500 companies based in Silicon Valley and the broader San Francisco Bay Area. It also has a presence in several other fast-growing US cities (such as Los Angeles, Seattle, Boston, Portland, Denver and Austin), presenting other platforms for growth in the employee shuttle market. The business has grown rapidly in recent years, as many new contracts have been won and existing customers’ services have expanded.
The remaining WeDriveU shares are held by Dennis Carlson (the CEO) and the senior management team, who will remain in place to oversee the next phase of their expansion. As part of the Transaction, National Express and the WeDriveU management team retain call and put options, respectively, over the remaining shares, exercisable annually over the next three years, with the option price determined by reference to WeDriveU’s profitability.
With this acquisition National Express will form a new shuttle division within its North American business, led by the WeDriveU management team, to drive expansion in the employee, university and hospital shuttle markets. Together these US markets are worth over $5 billion in annual revenue.
WeDriveU transports almost 7 million passengers annually and is an asset light business. In the year ended 31 December 2018, it generated annual revenues of $139.9 million, normalised EBITDA of $21.1 million and normalised operating profit of $15.4 million; as at 31 December 2018 gross assets were $80 million. The Transaction will be earnings accretive from completion.
Dean Finch, CEO of National Express Group, said: “I am delighted WeDriveU are joining National Express as part of our strategic acquisition programme. As the premier operator in Silicon Valley and the wider San Francisco Bay Area, WeDriveU provides the opportunity for expansion into a fast-growing market. WeDriveU also has a presence in other fast-growing cities in the US, which present other platforms for growth in this very attractive market.
“I am impressed with the growth Dennis has achieved in recent years and the whole business’ commitment to safety and customer service, which mirrors our own. I look forward to working with Dennis and his team to achieve their exciting growth plans and exploit additional, complementary opportunities as part of National Express Group to deliver further value to our shareholders.”
WeDriveU’s Chairman and CEO Dennis Carlson said: “I am delighted to be joining National Express. We have grown our business significantly in recent years and plan to continue expanding into new markets, drawing on National Express’ reputation for excellence and its extensive nationwide presence. I look forward to working with Dean and the team in this exciting next phase for our business.”
The person responsible for making this announcement on behalf of National Express is Jennifer Myram, Company Secretary.
Normalised EBITDA and operating profit exclude expenses that will be transferred to the vendor as a consequence of this transaction.
WeDriveU is the leader in transportation solutions, specialising in corporate shuttles serving 7 million annual passengers nationwide. Recognised as a pioneer in mobility, WeDriveU is a strategic partner to the world’s top brands, with client programmes that consistently earn awards for excellence in commuting and sustainability.https://www.wedriveu.com
About National Express Group
National Express Group is a leading public transport operator with bus, coach and rail services in the UK, Continental Europe, North Africa, North America and the Middle East. The Group has a fleet of over 30,000 vehicles and 900 million journeys are made on National Express services each year. National Express Group is quoted on the London Stock Exchange (NEX.L), and is a constituent of the FTSE 250 with 2018 underlying revenue of £2.45 billion. Further information on National Express Group can be found at: http://www.nationalexpressgroup.com.
Information set forth in this announcement may contain certain ‘forward-looking statements’ with respect to National Express Group PLC (‘Company’ or ‘Group’) and the Group’s financial condition, results of its operations and business, and certain plans, strategy, objectives, goals and expectations with respect to these items and the economies and markets in which the Group operates.
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