Deal to Increase STA’s Canadian Revenue by More than Two-Thirds

Deal to Increase STA’s Canadian Revenue by More than Two-Thirds(Jan. 21, 2008) — Parkview Transit has been a school bus mainstay in Ontario for the past 34 years and will continue to be under the new leadership of Student Transportation of America.

Shareholders of Canadex Resources Limited, which owns Parkview Transit, overwhelmingly approved STA’s acquisition bid to a tune of $41.8 million Canadian, approximately $40.6 million U.S. The additional 270 routes makes STA the fourth largest school bus company in Canada, company representatives said, with a fleet of more than 1,000 buses in Ontario and approximately $40 million, or $38.9 million U.S., in annual revenue. That equates to a 67 percent revenue increase and increases the company’s existing cash flow by 15 percent.

STA offered to acquire Canadex on Dec. 10.

“This is a great acquisition for us,” said Denis J. Gallagher, STA’s chairman and CEO. “Parkview Transit’s school bus operations are a perfect fit with our existing operations and add to our core strategy of building regional density in Ontario.”

An important part of the negotiations was 100 percent home-to-school contracts include fuel price protection, Gallagher said, adding that STA is currently discussing “various strategic alternatives” for its newly acquired energy division of Canadex. Parkview Transit currently serves a half dozen public and Catholic school boards in and around Toronto as well as special care services for the Ontario Ministry of Health. Its public transit business includes Barrie, Brampton, Mississauga, Toronto and eight other townships.
In its 11th year of existence, STA also operates more than 4,000 school buses in the United States, mostly in the northeast but also extending into Illinois, Minnesota and California.