12th Apr 2019 08:04
LONDON (Alliance News) - Public transport operator National Express Group PLC on Friday said it has paid USD84.3 million in cash for a 60% stake in US employee shuttle firm WeDriveU Holdings Inc.
National express also has the option to acquire the other 40% of WeDriveU, which is based in California's Silicon Valley, in tranches over the next three years. The deal is accretive to earnings from completion.
As well as Silicon Valley, WeDriveU also has a presence in other American cities, such as Los Angeles, Seattle, and Boston. In 2018, WeDriveU generated USD139.9 million of revenue and its normalised earnings before interest, taxation, depreciation, and amortization was USD21.1 million.
WeDriveU also posted a normalised operating profit of USD15.4 million for 2018 and at the end of that year gross assets stood at USD80 million.
The remaining WeDriveU shares not currently held by National Express are owned by Chief Executive Dennis Carlson and other members of the senior management team, all of whom will remain with the company.
National Express and WeDriveU's management team retain call and put options over the remaining shares, the option price for which will be determined by the profitability of WeDriveU.
Through the acquisition, National Express is to form a new shuttle division in its North American business which will be led by the WeDriveU management team.
National Express CEO Dean Finch 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."
Shares were 2.4% higher early Friday at 418.80 pence each.
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