Coach USA, Inc., and Coach XXIII Acquisition, Inc.--Control--Americoach Tours, Ltd.; Keeshin Charter Services, Inc.; Keeshin Transportation, L.P.; Niagara Scenic Bus Lines, Inc.; and Pawtuxet Valley Bus Lines

Vernon A. Williams
U.S. Department of Transportation
February 27, 1998

[Federal Register: February 27, 1998 (Volume 63, Number 39)]
[Notices]               
[Page 10071-10072]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr27fe98-170]


[[Page 10071]]

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DEPARTMENT OF TRANSPORTATION

Surface Transportation Board
[STB Docket No. MC-F-20916] 1

 
Coach USA, Inc., and Coach XXIII Acquisition, Inc.--Control--
Americoach Tours, Ltd.; Keeshin Charter Services, Inc.; Keeshin 
Transportation, L.P.; Niagara Scenic Bus Lines, Inc.; and Pawtuxet 
Valley Bus Lines

AGENCY: Surface Transportation Board.

ACTION: Notice tentatively approving finance transaction.

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SUMMARY: Coach USA, Inc. (Coach), a noncarrier, and its wholly owned 
noncarrier subsidiary, Coach XXIII Acquisition, Inc. (Coach 
Acquisition) (collectively, applicants), filed an application under 49 
U.S.C. 14303 to acquire control of Americoach Tours, Ltd. (Americoach), 
Keeshin Charter Services, Inc. (Keeshin), Keeshin Transportation, L.P. 
(KTLP), Niagara Scenic Bus Lines, Inc. (Niagara), and Pawtuxet Valley 
Bus Lines (Pawtuxet), all motor passenger carriers. Persons wishing to 
oppose the application must follow the rules under 49 CFR part 1182, 
subpart B. The Board has tentatively approved the transaction, and, if 
no opposing comments are timely filed, this notice will be the final 
Board action.

    \1\ This proceeding was originally docketed as STB Finance 
Docket No. 33534.
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DATES: Comments are due by April 13, 1998. Applicants may file a reply 
by May 4, 1998. If no comments are received by April 13, 1998, this 
notice is effective on that date.

ADDRESSES: Send an original and 10 copies of comments referring to STB 
Docket No. MC-F-20916 to: Surface Transportation Board, Office of the 
Secretary, Case Control Unit, 1925 K Street, N.W., Washington, DC 
20423-0001. In addition, send one copy of comments to applicants' 
representatives: Betty Jo Christian and David H. Coburn, Steptoe & 
Johnson LLP, 1330 Connecticut Avenue, N.W., 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 35 motor passenger 
carriers. 2 In this transaction, it seeks to acquire direct 
control of Americoach, 3 Niagara, 4 and Pawtuxet, 
5 by acquiring all of the outstanding stock of these 
carriers, and indirect control of Keeshin 6 and KTLP, 
7 through the acquisition, by Coach Acquisition, 
8 of all of the outstanding stock of Keeshin and the general 
partnership interest in KTLP. According to applicants, the stock (or, 
in the case of KTLP, the partnership interest) of each of the carriers 
to be acquired is currently held in separate, independent voting trusts 
to avoid any unlawful control pending disposition of this proceeding.
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    \2\ In addition to the instant proceeding in which it seeks to 
acquire control of five additional motor passenger carriers, Coach 
has two pending proceedings: Coach USA, Inc.--Control Exemption--
Browder Tours, Inc. and El Expreso, Inc., STB Finance Docket No. 
33506 (STB filed Oct. 31, 1997), in which it seeks to acquire 
control of two additional motor passenger carriers; and Coach USA, 
Inc.--Control--Airport Limousine Service, Inc. and Black Hawk-
Central City Ace Express, Inc., STB MC-F-20917 (STB filed Feb. 12, 
1998), in which it seeks to acquire control of two additional motor 
passenger carriers.
    \3\ Americoach is a Tennessee corporation. It holds federally 
issued operating authority in MC-212649 and intrastate operating 
authority issued by the Tennessee Public Service Commission. 
Americoach provides charter operations primarily in Tennessee, 
Arkansas, Mississippi and Missouri, with occasional operations in 
other states. The carrier operates 25 buses; it has 51 employees; 
and it earned revenues of approximately $2.9 million in 1996. Prior 
to the transfer of its stock into a voting trust, it had been owned 
by Shearon L. Breazeale and Philip L. Breazeale.
    \4\ Niagara is a New York corporation. It holds federally issued 
operating authority in MC-30787, intrastate operating authority 
issued by the New York Department of Transportation, and authority 
issued by the Province of Ontario, Canada. Niagara provides regular-
route commuter service along routes within western New York and 
charter and tour operations between points in western New York and 
points in the United States. The carrier operates 21 buses; it has 
75 employees; and it earned revenues of approximately $6.6 million 
in 1996. Prior to the transfer of its stock into a voting trust, it 
had been owned by Keith A. Fisher and Molly J. Schmitt.
    \5\ Pawtuxet is a Rhode Island corporation. It holds federally 
issued operating authority in MC-115432, intrastate operating 
authority in Connecticut, and operating authority within the 
Province of New Brunswick, Canada. Pawtuxet provides special and 
charter operations between points in Massachusetts, Connecticut, and 
Rhode Island and other points in the United States. The carrier 
operates 30 buses; it has 57 employees; and it earned revenues of 
approximately $2.5 million in 1996. Prior to the transfer of its 
stock into a voting trust, it had been owned by Ernest A. 
Archambault and Stephen P. Archambault.
    \6\ Keeshin is an Illinois corporation. It holds federally 
issued operating authority in MC-118044. Keeshin provides charter, 
group tours and shuttle operations from points in Illinois to 
various points in the United States. The carrier operates 47 buses; 
it has 102 employees; and it earned gross revenues of approximately 
$13.03 million in 1996. Prior to the transfer of its stock into a 
voting trust, it had been owned by Paul A. Keeshin.
    \7\ KTLP is a Delaware limited partnership. It holds federally 
issued operating authority in MC-263222. KTLP provides charter and 
special operations between points in the United States (except 
Hawaii) and commuter and shuttle bus services in the Chicago area. 
KTLP also owns a limited partnership interest in O'Hare Shuttle 
Partners, L.P., a non-federally regulated entity, which provides 
shuttle bus service at Chicago's O'Hare Airport. The carrier 
operates 18 buses; it has 75 employees; and it earned revenues of 
approximately $3.6 million in the first 9 months of 1996. Prior to 
the transfer of the general partnership interest in KTLP into a 
voting trust, the general partnership interest had been held by 
Keeshin. Paul A. Keeshin Trust, Brett Keeshin O'Hare Trust, and Neal 
Keeshin O'Hare Trust also held limited partnership interests in 
KTLP.
    \8\ Coach Acquisition is a Delaware corporation that was 
established for the purpose of serving as a holding company with 
respect to the transaction involving Keeshin and KTLP.
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    Applicants submit that there will be no transfer of any federal or 
state operating authorities held by the acquired carriers. Following 
the consummation of the control transactions, each of the acquired 
carriers will continue operating in the same manner as before and, 
according to applicants, granting the application will not reduce 
competitive options available to the traveling public. They assert that 
the acquired carriers do not compete to any meaningful degree with one 
another or with any Coach-owned carrier. Applicants submit that each of 
the acquired carriers is relatively small and each faces substantial 
competition from other bus companies and transportation modes.
    Applicants also submit 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, applicants claim that the 
carriers to be acquired will benefit from the lower insurance premiums 
negotiated by Coach and from volume discounts for equipment and fuel. 
Applicants indicate that Coach will provide each of the carriers to be 
acquired with centralized legal and accounting functions and 
coordinated purchasing services. In addition, they state that vehicle 
sharing arrangements will be facilitated through Coach to ensure 
maximum use and efficient operation of equipment and that, with Coach's 
assistance, coordinated driver training services will be provided, 
enabling each carrier to allocate driver resources in the most 
efficient manner possible. Applicants also state 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 further enhancing the benefits resulting from 
these control transactions.

[[Page 10072]]

    Applicants certify that the pertinent carrier parties hold 
satisfactory safety ratings from the U.S. Department of Transportation; 
that they have sufficient liability insurance; that they are neither 
domiciled in Mexico nor owned or controlled by persons of that country; 
and that 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 
applicants' 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 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.
    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 April 13, 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, N.W., 
Washington, DC 20530.

    Decided: February 20, 1998.

    By the Board, Chairman Morgan and Vice Chairman Owen.
Vernon A. Williams,
Secretary.
[FR Doc. 98-5109 Filed 2-26-98; 8:45 am]
BILLING CODE 4915-00-P