Aircoach sells stake to British firm

THE private bus operator Aircoach has sold 90% of the company to British transport firm First Group for €15 million.

Aircoach managing director John O'Sullivan said that following the deal, Aircoach would take on CIÉ in both the Dublin bus market and the inter-city coach business.

Transport Minister Seamus Brennan this year announced proposals to break CIE up into its three constituent parts Irish Rail, Bus Éireann and Dublin Bus. One proposal is to allow 25% of the Dublin bus market open to competition next year.

"It was always our intention to develop and enhance the airport service and to look at some intercity and franchise routes as soon as it practical," Mr O'Sullivan said yesterday.

"First Group are the premier player and have a big balance sheet and with these resources in expertise and finances it gives us a real fighting chance to participate when the market is liberalised."

Mr O'Sullivan said with First Group on board, the company would have a good opportunity to be there for the first tranche of the liberalised Dublin bus market.

He said that the overall turnover from Dublin Bus, with the subvention from the Government, is worth 200m annually, meaning that 50m in turnover will be available when the 25% franchise is awarded. He said expansion of the Aircoach service to Cork and Shannon airports was a possibility.

"Shannon is growing, but is only one-tenth the size of Dublin Airport's traffic, so it would be difficult to justify the same investment as we had in Dublin. But on a reduced scale it is something we would be interested in. We are planning a Dublin-Cork service and there is no reason why we can't put in a link to the airport."

First Group director Leon Daniels said the move by the Department of Transport towards the introduction of competition in road passenger transport services attracted First Group to the Irish market. "Aircoach provides an ideal platform from which to build optimised transport solutions. Aircoach and First have much in common such as their commitment to quality and safety," he said.

Mr O'Sullivan said when the transport market is liberalised he expects around three of four major players to take on CIÉ.

Aircoach was formed four years ago by Mr O'Sullivan as the first privately-owned licensed bus operator connecting Dublin Airport with the city centre and southern suburbs and will carry more than 1 million passengers this year. The remaining 10% of Aircoach is held by Mr O'Sullivan.

First Group was formed in 1995 and has 23% of the British bus market and 10,000 coaches.