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Kelsian USA Inc.--Acquisition of Control--AAAHI Topco Corporation Publication: Federal Register Agency: Surface Transportation Board Byline: Stefan Rice Date: 14 April 2023 Subjects: American Government  , Buses
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[Federal Register Volume 88, Number 72 (Friday, April 14, 2023)]
[Notices]
[Pages 23115-23117]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-07919]
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SURFACE TRANSPORTATION BOARD
[Docket No. MCF 21106]
Kelsian USA Inc.--Acquisition of Control--AAAHI Topco Corporation
AGENCY: Surface Transportation Board.
ACTION: Notice tentatively approving and authorizing finance
transaction.
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SUMMARY: On March 15, 2023, Kelsian USA Inc., (Kelsian USA), a
noncarrier, filed an application to acquire from AAAHI Holdings LLC
(Seller), a noncarrier, the motor carrier assets and direct control of
AAAHI Topco Corporation (Topco). Topco is a
[[Page 23116]]
noncarrier that indirectly wholly owns and controls the following
passenger motor carriers: First Class Transportation LLC, Ace Express
Coaches LLC, Hotard Coaches, Inc., Lux Bus America Co., Industrial Bus
Lines, Inc. d/b/a All Aboard America, and SureRide Charter Inc. d/b/a
Sun Diego Charter Co. (collectively, Regulated Carriers). The Board is
tentatively approving and authorizing the transaction, and, if no
opposing comments are timely filed, this notice will be the final Board
action.
DATES: Comments may be filed by May 26, 2023. If any comments are
filed, Kelsian USA may file a reply by June 13, 2023. If no opposing
comments are filed by May 26, 2023, this notice shall be effective on
May 27, 2023.
ADDRESSES: Comments may be filed with the Board either via e-filing at
www.stb.gov/proceedings-actions/e-filing/other-filings/or in writing
addressed to: Surface Transportation Board, 395 E Street SW,
Washington, DC 20423-0001. Comments must reference Docket No. MCF
21106. In addition, one copy of comments must be sent to Kelsian USA's
representative: Ayelet Hirschkorn, Kaplan Kirsch & Rockwell LLP, 450
Seventh Avenue, Suite 1401, New York, NY 10123.
FOR FURTHER INFORMATION CONTACT: Jonathon Binet at (202) 245-0368. If
you require an accommodation under the Americans with Disabilities Act,
please call (202) 245-0245.
SUPPLEMENTARY INFORMATION: Persons wishing to oppose the application
must follow the rules at 49 CFR 1182.5 and 1182.8.
According to the application, Kelsian USA is a recently established
Delaware corporation and wholly owned subsidiary of Kelsian
International Holdings Pty Ltd., which is a wholly owned subsidiary of
Kelsian Group Limited (Kelsian). (Appl. 1.) Kelsian, a public company
incorporated and domiciled in Australia, controls numerous subsidiaries
that provide integrated multi-modal transport and tourism services in
Australia as well as established bus operations in Singapore, London,
and the Channel Islands. (Id. at 1-2.) Kelsian USA states that neither
it, nor Kelsian, nor any of Kelsian's other subsidiaries currently
operate any transportation services in the United States. (Id. at 2.)
Seller is a non-carrier Delaware corporation that wholly owns
Topco, which in turn wholly owns AAAHI Tempco LLC, which in turn wholly
owns AAAHI Intermediate Holdings LLC, which in turn wholly owns AAAHI
Acquisition Corporation, which in turn wholly owns All Aboard America!
Holdings, Inc. (Id.) Tensile Capital Partners Master Fund LP is the
majority equity holder of Seller. (Id. at 2-3.) According to the
application, none of the entities in Seller's ownership chain have any
direct or indirect ownership interest in any interstate passenger motor
carrier other than the Regulated Carriers. (Id. at 3.) Kelsian states
that, through the transaction, it would acquire all of Seller's
outstanding stock of Topco, resulting in the placement of Topco and the
Regulated Carriers under the control of Kelsian.\1\ (Id. at 8.) The
Regulated Carriers are as follows:
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\1\ Additional information about the Regulated Carriers,
including U.S. Department of Transportation (USDOT) numbers, motor
carrier numbers, and USDOT safety fitness ratings, can be found in
the application. (See Appl. 3-7.) Kelsian USA states that the
transaction will also result in Kelsian USA indirectly owning and
controlling, in addition to the Regulated Carriers, the following
entities that are not subject to the jurisdiction of the Board: (i)
Lux Leasing LLC, a California limited liability company that leases
vehicles to Lux Bus; (ii) McClintock Enterprises, Inc., a California
corporation that no longer provides passenger motor carrier
services; (iii) All Aboard America School Transportation, LLC, a
Texas limited liability company that no longer provides passenger
motor carrier services; and (iv) All Aboard Transit Services LLC, a
Delaware limited liability company that no longer provides passenger
motor carrier services. (Id. at 7.)
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First Class Transportation LLC, which provides regional
interstate contract and charter passenger services between Texas and
points throughout the United States, as well as Texas intrastate
charter service and intrastate weekday park-and-ride commuter services
in the Houston, Tex., metropolitan area;
Ace Express Coaches, which operates charter and contract
passenger services in both interstate and Colorado intrastate commerce;
Hotard Coaches, Inc., which provides local and regional
contract and charter passenger services within Louisiana and to and
from various points within the continental United States;
Industrial Bus Lines, Inc., d/b/a All Aboard America,
which provides local and regional interstate and intrastate contract
and charter passenger services in Arizona, Texas, and New Mexico;
Lux Bus America Co., which provides interstate and
intrastate passenger group charter motor coach and shuttle services in
the Los Angeles and San Francisco Bay areas of California; and
SureRide Charter, Inc. d/b/a Sun Diego Charter Company,
which provides regional charter and contract passenger services from
its base in National City, Cal.
Under 49 U.S.C. 14303(b), the Board must approve and authorize a
transaction that it finds consistent with the public interest, taking
into consideration at least (1) the effect of the proposed transaction
on the adequacy of transportation to the public, (2) the total fixed
charges that result, and (3) the interest of affected carrier
employees. Kelsian USA has submitted the information required by 49 CFR
1182.2, including information to demonstrate that the proposed
transaction is consistent with the public interest under 49 U.S.C.
14303(b), see 49 CFR 1182.2(a)(7), and a jurisdictional statement under
49 U.S.C. 14303(g) that the aggregate gross operating revenues of the
Regulated Carriers exceeded $2 million during the 12-month period
immediately preceding the filing of the application, see 49 CFR
1182.2(a)(5).
Kelsian USA asserts that the transaction is consistent with the
public interest. Kelsian USA states that the transaction is not
expected to have a material, detrimental impact on the adequacy of
transportation services available for the public, but rather it
anticipates that public services will be improved as ``operating
efficiencies and innovative solutions are realized and implemented.''
(Appl. 10.) Moreover, according to Kelsian USA, there are no
significant fixed charges associated with the transaction. (Id.)
Kelsian anticipates that the Regulated Carriers will continue to
operate without any material impact on existing employment levels
resulting from the transaction, as the local general managers of the
Regulated Carriers will continue day-to-day operational management of
those companies and Kelsian ``is committed to maintaining the current
workforce of the Regulated Carriers and plans to continue that
workforce.'' (Id. at 11.) Kelsian USA asserts that that neither
competition nor the public interest will be adversely affected by the
proposed transaction, as the transaction only involves the transfer of
Seller's holding company (Topco) and ownership and control of the
Regulated Carriers to another non-passenger carrier holding company
that does not currently have any ownership interests in, or control of,
any other passenger motor carrier in the United States. (Id. at 12.)
Moreover, Kelsian USA notes that, because it does not currently operate
any motor carrier service in the United States, there will be no
overlap in the service areas or customer bases of the Regulated
Carriers and Kelsian USA. (Id.)
The Board finds that the acquisition as proposed in the application
is consistent with the public interest and should be tentatively
approved and
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authorized. If any opposing comments are timely filed, these findings
will be deemed vacated, and, unless a final decision can be made on the
record as developed, a procedural schedule will be adopted to
reconsider the application. See 49 CFR 1182.6. If no opposing comments
are filed by expiration of the comment period, this notice will take
effect automatically and will be the final Board action.
This action is categorically excluded from environmental review
under 49 CFR 1105.6(c).
Board decisions and notices are available at www.stb.gov.
It is ordered:
1. The proposed transaction is approved and authorized, subject to
the filing of opposing comments.
2. If opposing comments are timely filed, the findings made in this
notice will be deemed vacated.
3. This notice will be effective May 27, 2023, unless opposing
comments are filed by May 26, 2023. If any comments are filed, Kelsian
USA may file a reply by June 13, 2023.
4. A copy of this notice will be served on: (1) the U.S. Department
of Transportation, Federal Motor Carrier Safety Administration, 1200
New Jersey Avenue SE, Washington, DC 20590; (2) the U.S. Department of
Justice, Antitrust Division, 10th Street & Pennsylvania Avenue NW,
Washington, DC 20530; and (3) the U.S. Department of Transportation,
Office of the General Counsel, 1200 New Jersey Avenue SE, Washington,
DC 20590.
Decided: April 10, 2023.
By the Board, Board Members Fuchs, Hedlund, Oberman, Primus, and
Schultz.
Stefan Rice,
Clearance Clerk.
[FR Doc. 2023-07919 Filed 4-13-23; 8:45 am]
BILLING CODE 4915-01-P