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Interested in contacting us about this deal?
Jason GatenbyChief Executive
T: +44 20 7336 9947
E: jason.gatenby@ montagu.com
Detailed Information
1994 was the ‘Year of the Bus’ for HSBC Private Equity. Having
participated in the buyout of Greater Manchester Buses (South),
HSBC Private Equity brought its bus experience to London and backed
the buyouts of three of the ten London operating companies. One of
these was of CentreWest, the first of the major London bus
privatisations. HSBC Private Equity won the mandate to finance the
management bid against stiff competition from several other venture
capitalists.
CentreWest had a turnover of £40 million (€64 million) per annum and ran over 40 routes connecting Ealing, Hillingdon, Barnet and Inner West London with Central London. The company had 500 buses and 1,500 staff operating from five garages. Its reputation for innovation and quality of service, together with management’s proven ability to control costs and strengthen revenue in an increasingly competitive environment, made it an attractive proposition for HSBC Private Equity.
Since formation in 1989 the CentreWest team, under managing director Peter Hendy, have led the field in London with the introduction of service improvements. New smaller midibuses have replaced double deckers, facilitation improved frequency and reliability of service, while a passenger information system has been installed at bus stops on two major trunk routes.
London is one of the biggest bus markets in the world with 3.6 million bus journeys every working day. Everywhere in the UK, bus companies compete to run buses in a deregulated environment, but in London the market remains regulated with the routes run according to contracts awarded by London Transport through a tendering process.
Post completion, the challenge for the management team was to maintain their prominent position in the London market. This was achieved with the support of the employees who had demonstrated their commitment in the past with one of the best industrial relations records in the London bus industry. Both they and management benefited financially when the business was sold in 1997 to FirstBus plc.
CentreWest had a turnover of £40 million (€64 million) per annum and ran over 40 routes connecting Ealing, Hillingdon, Barnet and Inner West London with Central London. The company had 500 buses and 1,500 staff operating from five garages. Its reputation for innovation and quality of service, together with management’s proven ability to control costs and strengthen revenue in an increasingly competitive environment, made it an attractive proposition for HSBC Private Equity.
Since formation in 1989 the CentreWest team, under managing director Peter Hendy, have led the field in London with the introduction of service improvements. New smaller midibuses have replaced double deckers, facilitation improved frequency and reliability of service, while a passenger information system has been installed at bus stops on two major trunk routes.
London is one of the biggest bus markets in the world with 3.6 million bus journeys every working day. Everywhere in the UK, bus companies compete to run buses in a deregulated environment, but in London the market remains regulated with the routes run according to contracts awarded by London Transport through a tendering process.
Post completion, the challenge for the management team was to maintain their prominent position in the London market. This was achieved with the support of the employees who had demonstrated their commitment in the past with one of the best industrial relations records in the London bus industry. Both they and management benefited financially when the business was sold in 1997 to FirstBus plc.