Badgerline pays pounds 38m to take Rider on board: Acquisition takes Bristol group into pole position among private-sector bus operators
Tuesday 22 March 1994
The group, based in Bristol, is paying pounds 38m for Rider, which is the fifth-biggest private operator with 1,100 buses.
Rider was bought out by management and employees in 1988 from the municipally owned Yorkshire Rider company, and was widely expected to seek a flotation as an independent operation. But Bill Cottham, its chairman and managing director, said the board had concluded that Rider could best be developed as part of a bigger bus grouping. One worker director, Mohammed Taj, dissented and declined to recommend the offer.
Graeme Varley, Badgerline's managing director, said there was not an open sale and that Rider negotiated exclusively with Badgerline. The management and employees own 100 per cent of Rider and the executive directors and other shareholders representing 50.9 per cent of the equity have already undertaken irrevocably to sell to Badgerline.
The offer is 16 Badgerline shares for every five in Rider. Shareholders can elect to take cash for up to half their holdings. The offer is underwritten by Lazards. The maximum number of new Badgerline shares that will be created by the deal is 33.6 million, or 27 per cent of the enlarged share capital.
Rider made pounds 3.9m before tax in the year to 31 March 1993 on turnover of pounds 83.9m.
Mr Varley said Badgerline would now consolidate and not seek any big acquisitions for at least 12 months, which may rule it out of bidding for one of the London bus firms expected to be privatised this year.
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