Terry W. Fischer & TKRG Holdings Inc.--Acquisition of Control--Royal Coach Tours Publication: Federal Register Agency: Surface Transportation Board Byline: Raina White Date: 18 August 2023 Subjects: American Government , Buses Topics: Royal Coach Tours

[Federal Register Volume 88, Number 159 (Friday, August 18, 2023)]
[Notices]
[Pages 56686-56687]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-17791]


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SURFACE TRANSPORTATION BOARD

[Docket No. MCF 21109]


Terry W. Fischer & TKRG Holdings Inc.--Acquisition of Control--
Royal Coach Tours

AGENCY: Surface Transportation Board.

ACTION: Notice tentatively approving and authorizing finance 
transaction.

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SUMMARY: On July 21, 2023, Terry W. Fischer (Fischer) and TKRG Holdings 
Inc. (TKRG) (collectively, Applicants) filed an application to acquire 
from Daniel K. Smith and Sandra S. Allen (Individual Sellers) and New 
Holdco, a to-be-formed California corporation, control of all the 
outstanding equity interests of Royal Coach Tours (Royal), a passenger 
motor carrier. 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 October 2, 2023. If any comments are 
filed, Applicants may file a reply by October 17, 2023. If no opposing 
comments are filed by October 2, 2023, this notice will be final on 
October 3, 2023.

ADDRESSES: Comments may be filed with the Board either via e-filing on 
the Board's website or mailing to the Board's offices and must 
reference Docket No. MCF 21109. Comments may be filed at www.stb.gov/proceedings-actions/e-filing/other-filings/. Mailed comments may be 
sent to: Surface Transportation Board, 395 E Street SW, Washington, DC 
20423-0001. In addition, one copy of comments must be sent to 
Applicants' representative: Andrew K. Light, Scopelitis, Garvin, Light, 
Hanson & Feary, P.C., 10 W Market Street, Suite 1400, Indianapolis, IN 
46204.

FOR FURTHER INFORMATION CONTACT: Amanda Gorski at (202) 245-0291. If 
you require an accommodation under the Americans with Disabilities Act, 
please call (202) 245-0245.

SUPPLEMENTARY INFORMATION: According to the application, Fischer is an 
individual resident of the state of California and directly owns and 
controls all of the equity and voting interest of Transportation 
Charter Services, Inc. (TCS). (Appl. 2.) TKRG is a Delaware limited 
liability company, headquartered in California, and indirectly 
controlled by Fischer. (Id.) Applicants state that neither applicant is 
a federally regulated passenger motor carrier, and other than Fischer, 
none of the entities or persons having direct or indirect interests in 
TKRG control any federally regulated interstate passenger motor 
carrier.\1\ (Id. at 2-3.)
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    \1\ According to the application, as of the closing of the 
transaction, the outstanding shares of TKRG will be held by RCTB, 
LLC (RCTB), a Delaware limited liability company; the outstanding 
membership interests in RCTB will be held by TFKF 50 Holdings LLC 
(TFKF) (67.5%), Blue Fin Equity Partners LLP (Blue Fin) (22.5%), and 
GHSG, LLC (GHSG) (10%); the outstanding membership interests in TFKF 
will be held by Fischer (51%) and Fischer's brother, Kevin Fischer 
(49%); the partnership interests in Blue Fin will be controlled by 
Remi Poissant and Jane Poissant; and the membership interest in GHSG 
will be owned and controlled by Greg Gallup, an individual and 
current management employee of Royal. (Appl. 2; id. at Ex. C (chart 
of the organizational structure of the Royal Coach Tours, post-
transaction).)
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    TCS is an interstate passenger motor carrier that holds interstate 
carrier operating authority under FMCSA Docket No. MC-229775 and a 
USDOT safety rating of ``Satisfactory.'' (Id. at 2; id. at Ex. B.) TCS 
provides charter bus services in Southern California for third-party 
tour operators, private party charters, and school groups. (Id. at 3.) 
TCS also provides motor coach transportation services, primarily 
focused on charter bus services for third-party tour operators and 
private group outings, in the Canadian Rockies Area of Alberta, Canada. 
(Id.) In addition, TCS provides limited contractual employee shuttle 
service employees at the San Diego International Airport during on-
going construction projects. (Id.)
    Individual Sellers are current shareholders of Royal and are 
noncarriers that do not control any federally regulated passenger motor 
carrier other than Royal. (Id. at 4.) Immediately prior to the sale of 
Royal, Individual Sellers will effect a reorganization of Royal such 
that Royal will become a California limited liability company wholly 
owned by New Holdco, a to-be-formed corporation, which will be wholly 
owned by Individual Sellers. (Id. at 4.)
    Royal is a California corporation, headquartered in California, 
that holds interstate carrier operating authority under FMCSA Docket 
No. MC-142846 and a USDOT safety rating of ``Satisfactory,'' as well as 
intrastate charter-party operating authority issued by the California 
Public Utilities Commission and intrastate charter bus authority issued 
by the Nevada Transportation Authority. (Id.) Royal provides motor 
coach charter transportation services from its terminal facilities 
located in San Jose, Cal. (Bay Area), Las Vegas, Nev., and Phoenix, 
Ariz. (Id. at 4-5.) Royal also provides a limited amount of intrastate 
employee commuter shuttle services for employers in the Bay Area. (Id. 
at 5.) In providing these services, Royal utilizes approximately 73 
motor coaches and 1 minibus, and approximately 115 drivers. (Id.) 
Applicants state that these services do not overlap with the geographic 
area of service offerings of TCS. (Id.)
    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. Applicants have 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 TCS 
and Royal exceeded $2 million during the 12-month period immediately 
preceding the filing of the application, see 49 CFR 1182.2(a)(5).
    Applicants state that the transaction is not expected to have a 
material, detrimental impact on the adequacy of transportation services 
available for the public, as the services Royal currently provides will 
continue to be provided

[[Page 56687]]

by Royal under the same name and from the same locations as prior to 
the transaction. (Id. at 7.) Further, Applicants assert that bringing 
Royal under the control of Fischer, who is experienced in the same 
market segments served by Royal (i.e., private charter transportation 
and employee shuttle operations), will result in improved operating 
efficiencies, increased equipment utilization rates, and cost savings 
derived from economies of scale, which will help ensure the provision 
of adequate service to the public. (Id.) Applicants state that the 
transaction will increase fixed charges in the form of interest expense 
because funds will be borrowed by TKRG to assist in the funding of the 
transaction but that such an increase will not impact the provision of 
transportation to the public. (Id.) Applicants further state that they 
intend to continue existing operations of Royal and as such, the 
transaction will not materially impact employees or labor conditions. 
(Id. at 8.) Applicants assert that that neither competition nor the 
public interest will be adversely affected by the proposed transaction, 
as Royal's operations consist primarily of charter bus transportation, 
as well as limited employee commuter services, which are markets that 
are very competitive in the geographic areas served by Royal. (Id. at 
9.) Applicants note that all charter service providers, including 
Royal, compete with other modes of passenger transportation. (Id. at 
10.) Lastly, Applicants state the Royal's services are geographically 
dispersed from the service areas of TCS. (Id.)
    The Board finds that the acquisition as proposed in the application 
is consistent with the public interest and should be tentatively 
approved and authorized. If any opposing comments are timely filed,\2\ 
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.
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    \2\ Persons wishing to oppose the application must follow the 
rules at 49 CFR 1182.5 and 1182.8.
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    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 October 3, 2023, unless opposing 
comments are filed by October 2, 2023. If any comments are filed, 
Applicants may file a reply by October 17, 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: August 12, 2023.

    By the Board, Board Members Fuchs, Hedlund, Oberman, Primus, and 
Schultz.
Raina White,
Clearance Clerk.
[FR Doc. 2023-17791 Filed 8-17-23; 8:45 am]
BILLING CODE 4915-01-P