ComfortDelGro Corporation (CGD) has announced the acquisition of business assets of a bus operator in Queensland, Australia for a total purchase consideration of A$17.5 million ($17.53 million).
The transaction, entered into via its wholly-owned Australian subsidiary, will see the acquisition of business assets from Young’s Bus Services based in Rockhampton.
Young’s Bus Services manages a fleet of 42 buses and two depots. It is the largest bus operator in Rockhampton and operates urban regional bus and school bus service contracts which provide dedicated route and school bus services under long-term contracts with the State Department of Transport and Main Roads for Queensland.
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The acquisition will enable CDC to expand its bus operations in Queensland, where it already operates 155 buses. Upon completion of the acquisition, CDC’s bus fleet in Queensland will increase to 197 buses with the total number of buses operated in Australia increasing to close to 2500 buses.
The acquisition is subject to regulatory approval and will be financed through internal funds. According to CDG, the acquisition is not expected to have any material impact on the net tangible assets per share and the earnings per share of the CDG group for the current financial year.
As at 1.25pm, shares in CDG are down 1 cent or 0.64% lower at $1.56.