Toronto, Ontario, June 14, 2006 – Student Transportation of America Ltd. and Student Transportation of America ULC (collectively, the “Issuer”) (TSX:STB.UN) announced today that it has closed its offering of income participating securities (“IPSs”) at a price of $12.25 per IPS for total gross proceeds of $60,025,000. The offering was underwritten by a syndicate of underwriters led by CIBC World Markets Inc., and including Sprott Securities Inc., Wellington West Capital Markets Inc. and National Bank Financial Inc.

Net proceeds from the financing will be used to repay existing indebtedness incurred in respect of the recent acquisitions including Positive Connections, Inc., Liftlock Coach Lines Limited, and to fund investment requirements of previously announced contract awards and for general corporate purposes.

The securities have not been and will not be registered under the U.S. Securities Act or any state securities laws and the IPSs are being offered and sold within the United States exclusively to persons reasonably believed by the underwriters to be qualified institutional buyers as defined in Rule 144A under the U.S. Securities Act.

Profile

Student Transportation is the fifth-largest provider of school bus transportation services in North America, conducting operations through local operating subsidiaries. Student Transportation has become a leading school transportation and management company by aggregating operations through the consolidation of existing providers and conversion of in-house operations and currently operates more than 4,000 school vehicles in North America. For more information, please visit www.sta-ips.com.

Forward-Looking Statements

This news release contains “forward-looking statements” within the meaning of applicable securities laws, which reflects the expectations of management regarding the Issuer’s and Company’s results of operations, expense levels, seasonality, cash flows, performance, liquidity, borrowing availability, financial ratios, ability to execute the Company’s growth strategy and cash distributions. Forward-looking statements generally can be identified by the use of forward-looking terminology such as “may”, “will”, “expect”, “intend”, “track”, “targeted”, “estimate”, “anticipate”, “believe”, “should”, “plans” or “continue” or similar expressions suggesting future outcomes or events. These forward looking statements reflect the Company’s current expectations regarding anticipated future events, results, circumstances, performance or expectations that are not historical facts. Forward looking statements involve significant risks and uncertainties, and should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not or the times at which or by the performance or results will be achieved. A number of factors could cause our actual results to differ materially from the results discussed, expressed or implied in any forward-looking statement made by us or on our behalf, including, but not limited to, the factors discussed under “Risk Factors” in our Annual Information Form. These forward looking statements are made as of the date of this news release and, except as required by applicable law, we undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

For more information contact:

Denis J. Gallagher

Chairman and Chief Executive Officer

Phone: (732) 280-4200

Fax: (732) 280-4213



Patrick J. Walker

Chief Financial Officer

Phone (732) 280-4200

Fax: (732) 280-4213



Keith P. Engelbert

Director of Investor Relations

Phone: (732) 280-4200

Fax: (732) 280-4213

[email protected]