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SeaLink parks another bus company in its garage

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SA company SeaLink Travel Group will acquire WA bus operator Go West Tours for $88.5 million as it continues to bolster its national and global transport holdings.

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The company also announced this week it has purchased the first hydrogen buses to service public transport contracts in Australia.

SeaLink, which is best known locally for its Kangaroo Island ferry service and similar operations around Australia, acquired bus operator Transit Systems Group in January 2020 for $635 million.

The Australian and international bus components of the business now contribute more than 80 per cent of the company’s revenues.

The bus arm, which operates 18 government contracts in Australia and 23 in Singapore and London, generated $472 million in revenue for the six months to December 31 to take the company’s total revenue to $570.8 million.

The Go West Tours acquisition includes an upfront payment of $72.4 million and $16.1 million in deferred payments over two years, providing current earning levels are maintained. It includes three bus depots valued at $3.8 million.

The acquisition from the Haoust family will be funded from existing cash reserves and existing undrawn senior debt facilities.

Go West services the mining and regional sectors in WA and has multi-year contracts with leading mining companies and other regional services such as school bus transfers, which helped it generate $46.2 million in revenue in the 12 months to September 30, 2020.

The company has a fleet of 287 buses across nine depots, with 181 employees.

SeaLink Group CEO Clint Feuerherdt said the acquisition allowed the company to enter a new market that was highly complementary to its existing Australian bus transport capabilities.

“Go West has valuable contract counterparties and delivers an essential service for these clients,” he said.

“The operations of Go West were unaffected by the COVID-19 pandemic and continued at near 100 per cent levels throughout, keeping their communities and worksites connected.

“We are very excited about the growth opportunities this acquisition provides SeaLink and look forward to welcoming all of Go West’s employees to the Group.”

SeaLink also announced this week that its bus arm Transit Systems had purchased the first hydrogen buses to service public transport contracts in Australia.

The two Foton Mobility buses are expected to arrive in Australia from China in the coming weeks and will likely go into service mid-year.

Transit Systems currently operate metropolitan bus contracts in Victoria, South Australia, New South Wales, Western Australian and Northern Territory.

SeaLink is yet to announce where the buses will operate.

The bus arm already has some experience with hydrogen buses.

Transit Systems ran the second-longest hydrogen bus trial in the world as part of its Transport for London (TfL) operations.

Foton, which has already sold hundreds of hydrogen buses in China,  has partnered with Sydney-based TrueGreen to create Foton Mobility.

The new company plans to build hydrogen buses in New South Wales.

The first four of the group’s 45-seat buses are expected to arrive in Australia soon, two of which will go to SeaLink.

“We are procuring and delivering these buses with the expectation and knowledge that future buses will be built here, with our partners at Foton Mobility, part of the Australian owned True Green Mobility Group,” Feuerherdt said.

“We are proudly setting the global benchmark for exploring and trialling different technologies to find and develop solutions with our key industry partners that suit the dynamic and complex operating conditions within the Australian public transport landscape.”

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