[Federal Register Volume 63, Number 118 (Friday, June 19, 1998)]
[Notices]
[Pages 33760-33761]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-16392]


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DEPARTMENT OF TRANSPORTATION

Surface Transportation Board
[STB Docket No. MC-F-20921]


Coach USA, Inc.--Control--Blue Bird Coach Lines, Inc.; Butler 
Motor Transit, Inc.; Gad-About Tours, Inc.; P&S Transportation, Inc.; 
Pittsburgh Transportation Charter Services, Inc.; Syracuse and Oswego 
Coach Lines, Inc.; Tippett Travel, Inc., d/b/a Marie's Charter Bus 
Lines; Tucker Transportation Co., Inc.; and Utica-Rome Bus Co., Inc.

AGENCY: Surface Transportation Board, DOT.

ACTION: Notice tentatively approving finance transaction.

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SUMMARY: Coach USA, Inc. (Coach), a noncarrier, filed an application 
under 49 U.S.C. 14303 to acquire control of Blue Bird Coach Lines, Inc. 
(Blue Bird), Butler Motor Transit, Inc. (Butler), Gad-About Tours, Inc. 
(Gad-About), P&S Transportation, Inc. (P&S), Pittsburgh Transportation 
Charter Services, Inc. (PTCS), Syracuse and Oswego Coach Lines, Inc. 
(S&O), Tippett Travel, Inc., d/b/a Marie's Charter Bus Lines (Tippett), 
Tucker Transportation Co., Inc. (Tucker), and Utica-Rome Bus Co., Inc. 
(Utica-Rome), all motor passenger carriers. Persons wishing to oppose 
the application must follow the rules under 49 CFR part 1182, subparts 
B and C. The Board has tentatively approved the transaction, and, if no 
opposing comments are timely filed, this notice will be the final Board 
action.

DATES: Comments must be filed by August 3, 1998. Applicant may file a 
reply by August 24, 1998. If no comments are filed by August 3, 1998, 
this notice is effective on that date.

ADDRESSES: Send an original and 10 copies of comments referring to STB 
Docket No. MC-F-20921 to: Surface Transportation Board, Office of the 
Secretary, Case Control Unit, 1925 K Street, NW, Washington, DC 20423-
0001. In addition, send one copy of comments to applicant's 
representatives: Betty Jo Christian and David H. Coburn, Steptoe & 
Johnson LLP, 1330 Connecticut Avenue, NW, Washington, DC 20036.

FOR FURTHER INFORMATION CONTACT: Beryl Gordon, (202) 565-1600. [TDD for 
the hearing impaired: (202) 565-1695.]

SUPPLEMENTARY INFORMATION: Coach currently controls 45 motor passenger 
carriers. In this transaction, it seeks to acquire direct control of 
Blue Bird,<SUP>1</SUP> Butler,<SUP>2</SUP> Gad-About,<SUP>3</SUP> 
P&S,<SUP>4</SUP> PTCS,<SUP>5</SUP> S&O,<SUP>6</SUP> 
Tippett,<SUP>7</SUP> Tucker,<SUP>8</SUP> and Utica-Rome <SUP>9</SUP> by 
acquiring all of the outstanding stock of these carriers. According to 
applicant, the stock of

[[Page 33761]]

each of these carriers is currently held in independent voting trusts 
to avoid any unlawful control pending disposition of this proceeding.
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    \1\ Blue Bird is a New York corporation. It holds federally 
issued operating authority in MC-108531, intrastate operating 
authority issued by the New York Department of Transportation 
(NYDOT), the Pennsylvania Public Utilities Commission (PAPUC), the 
New Jersey Department of Transportation, and the Ohio Public 
Utilities Commission (OHPUC), and authority issued by the Province 
of Ontario, Canada. The carrier operates 127 motorcoaches, 21 school 
buses and 8 vans; and it earned revenues of approximately $14.1 
million in Fiscal Year (FY) 1996. Prior to the transfer of its stock 
into a voting trust, it had been owned by Louis A. Magnano.
    \2\ Butler is a Pennsylvania corporation. It holds federally 
issued operating authority in MC-126876 and intrastate authority 
issued by the PAPUC. The carrier operates 28 buses and 3 sedans; it 
has 68 employees; and it earned revenues of approximately $4.7 
million in FY 1996. Prior to the transfer of its stock into a voting 
trust, it had been owned by William G. Kaylor, Robert M. Kaylor and 
Thomas M. Kaylor. Prior to the establishment of a voting trust, 
Butler owned all of the stock of Gad-About, which Coach is also 
proposing to acquire in this transaction.
    \3\ Gad-About is an Ohio corporation. It holds federally issued 
operating authority in MC-198451 and intrastate authority issued by 
the OHPUC. The carrier operates 3 buses; it has 14 employees; and it 
earned revenues of approximately $1.9 million in FY 1996. Prior to 
the transfer of its stock into a voting trust, it had been owned by 
Butler.
    \4\ P&S is a Florida corporation. It holds federally issued 
operating authority in MC-255382. The carrier operates 30 buses; it 
has 58 employees; and it earned revenues of approximately $3.7 
million in FY 1996. Prior to the transfer of its stock into a voting 
trust, it was owned by Daniel G. Schambon.
    \5\ PTCS is a Delaware corporation. It holds federally issued 
operating authority in MC-319195. The carrier operates 400 vehicles; 
it has 260 employees; and, together with affiliated companies, it 
earned revenues of approximately $13 million in FY 1997. Prior to 
the transfer of its stock into a voting trust, it had been owned by 
Tyburn Limited, a noncarrier.
    \6\ S&O is a New York corporation. It holds federally issued 
operating authority in MC-117805 and intrastate authority issued by 
the NYDOT. The carrier operates 14 buses; it has 26 employees; and 
it earned revenues of approximately $1.7 million in 1997. Prior to 
the transfer of its stock into a voting trust, it had been owned by 
Russell Ferdinand. The carrier is affiliated through common 
ownership with Utica-Rome.
    \7\ Tippett is a Florida corporation. It holds federally issued 
operating authority in MC-174043. The carrier operates 17 buses, 3 
minibuses, and 1 limousine; it has 38 employees; and it earned 
revenues of approximately $4.4 million for the fiscal year ending 
June 30, 1997. Prior to the transfer of its stock into a voting 
trust, it was owned by Marie Louise Tippett.
    \8\ Tucker is a Florida corporation. It holds federally issued 
operating authority in MC-223424. The carrier operates 7 buses; it 
has 24 employees; and it earned revenues of approximately $650,000 
for the fiscal year ending May 31, 1997. Prior to the transfer of 
its stock into a voting trust, it was owned by Benjamin C. Early.
    \9\ Utica-Rome is a New York corporation. It holds federally 
issued operating authority in MC-7914 and intrastate operating 
authority issued by the NYDOT. The carrier operates 13 buses; it has 
37 employees; and it earned revenues of approximately $1.6 million 
in 1997. Prior to the transfer of its stock into a voting trust, it 
was owned by Russell Ferdinand, who also owned all of the stock of 
S&O.
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    Applicant submits that there will be no transfer of any federal or 
state operating authorities held by the acquired carriers. Following 
the consummation of the control transaction, each of the acquired 
carriers will continue operating in the same manner as before and, 
according to applicant, granting the application will not reduce 
competitive options available to the traveling public. Applicant 
asserts that the acquired carriers do not compete with one another or, 
to any meaningful degree, with any other Coach-controlled company. 
Applicant submits that each of the acquired carriers is relatively 
small and each faces substantial competition from other bus companies 
and other transportation modes.
    Applicant also submits that granting the application will produce 
substantial benefits, including interest cost savings from the 
restructuring of debt and reduced operating costs from Coach's enhanced 
volume purchasing power. Specifically, applicant claims that the 
carriers to be acquired will benefit from lower insurance premiums 
negotiated by Coach and from volume discounts for equipment and fuel. 
Applicant indicates that Coach will provide each of the carriers to be 
acquired with centralized legal and accounting functions and 
coordinated purchasing services. In addition, applicant states that 
vehicle sharing arrangements will be facilitated through Coach to 
ensure maximum use and efficient operation of equipment and that 
coordinated driver training services will be provided. Applicant also 
states that the proposed transaction will benefit the employees of the 
acquired carriers and that all collective bargaining agreements will be 
honored by Coach.
    Coach plans to acquire control of additional motor passenger 
carriers in the coming months. It asserts that the financial benefits 
and operating efficiencies will be enhanced further by these subsequent 
transactions. Over the long term, Coach states that it will provide 
centralized marketing and reservation services for the bus firms that 
it controls, thereby enhancing the benefits resulting from these 
control transactions.
    Applicant certifies that: (1) Blue Bird, Butler, Gad-About, and P&S 
hold satisfactory safety ratings from the U.S. Department of 
Transportation (DOT) and that PTCS, S&O, Tippett, Tucker, and Utica-
Rome have not been rated by DOT; (2) each of the acquired carriers has 
sufficient liability insurance; (3) none of the acquired carriers is 
either domiciled in Mexico or owned or controlled by persons of that 
country; and (4) approval of the transaction will not significantly 
affect either the quality of the human environment or the conservation 
of energy resources. Additional information may be obtained from 
applicant's representatives.
    Under 49 U.S.C. 14303(b), we must approve and authorize a 
transaction we find consistent with the public interest, taking into 
consideration at least: (1) The effect of the transaction on the 
adequacy of transportation to the public; (2) the total fixed charges 
that result; and (3) the interest of affected carrier employees.
    On the basis of the application, we find that the proposed 
acquisition of control is consistent with the public interest and 
should be authorized. If any opposing comments are timely filed, this 
finding will be deemed vacated and a procedural schedule will be 
adopted to reconsider the application. If no opposing comments are 
filed by the expiration of the comment period, this decision will take 
effect automatically and will be the final Board action.
    Board decisions and notices are available on our website at 
``WWW.STB.DOT.GOV.''
    This decision will not significantly affect either the quality of 
the human environment or the conservation of energy resources.
    It is ordered:
    1. The proposed acquisition of control is approved and authorized, 
subject to the filing of opposing comments.
    2. If timely opposing comments are filed, the findings made in this 
decision will be deemed vacated.
    3. This decision will be effective on August 3, 1998, unless timely 
opposing comments are filed.
    4. A copy of this notice will be served on the U.S. Department of 
Justice, Antitrust Division, 10th Street & Pennsylvania Avenue, NW, 
Washington, DC 20530.

    Decided: June 10, 1998.

    By the Board, Chairman Morgan and Vice Chairman Owen.
Vernon A. Williams,
Secretary.
[FR Doc. 98-16392 Filed 6-18-98; 8:45 am]
BILLING CODE 4915-00-P