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Bus & Motorcoach News July 1, 2004 THE NEWS RESOURCE FOR THE BUS AND MOTORCOACH INDUSTRY Motor Coach Industries Tortured Takeover refinances, reduces debt SCHAUMBURG, Ill. – Motor MCI’s overall debt. Problems plague transfer of N.Y. Service Coach Industries International Inc. JLL Partners of New York City NEW YORK CITY – The employees of the seven private has refinanced its senior secured swapped more than $100 million planned July 1 takeover by the companies, worker compensa- debt, and simultaneously reduced of MCI debt it acquired on the New York Metropolitan Trans- tion, and what will become of its total debt in a equity swap. open market for additional equity. portation Authority of more the bus terminals and other Acting to beat an expected Because neither MCI nor JLL than 80 bus routes now operated facilities now owned by the pri- run-up in interest rates during the are public companies they are by private companies is moving vate operators. next year, MCI refinanced senior under no obligation to disclose forward – in fits and starts. “All I can tell you is that we company debt that was due in June specific details of MCI’s debt or Those familiar with the oft- are in the midst of extremely of next year, obtaining new credit JLL’s equity stake. When JLL times contentious negotiations complicated negotiations with terms that extend the debt bought MCI five years ago, the between the city and the pri- the private bus lines,” said city through Dec. 1, 2008. company had roughly $450 million vate companies say a variety of spokesman Jordan Baowitz. Most economists believe the in long-term debt. issues have slowed progress, MTA spokesman Tom Fed almost certainly will take Ramsey Frank, senior manag- creating a charged atmosphere Kelly said the authority has actions in the coming months that ing director at JLL Partners said, that has fostered talk of a walk- been preparing for the takeover will result in interest rates rising 75 “We continue to be pleased with out by drivers and other diffi- Green Bus Lines is one of the seven companies for some time and is ready to to 100 basis points by early next our investment in MCI. The man- culties. being displaced by New York MTA. go. “If all of the contracts are year. agement has done an excellent job “We just don’t know what’s commuters into Manhattan from signed and the legislation is As part of MCI’s refinancing, to streamline the company’s cost going on and probably won’t until the Bronx, Queens and Brooklyn. completed, then we will take over the Wall Street investment com- structure and to expand market the very end,” said Martin Burke, The talks have involved a wide fully on July 1 as planned,” he said. pany that owns control of the na- share during the industry down- vice president of Queens Surface range of controversial issues, includ- The city has been pushing for tion’s largest motorcoach manufac- turn. Corp., one of the seven companies ing the hiring of union drivers by the takeover for about two years, turer also decided it would reduce CONTINUED ON PAGE 13 þ that transports about 400,000 daily the MTA, the fate of non-union CONTINUED ON PAGE 14 þ Abundance of challenges No mandatory safety briefings WASHINGTON – The Federal The idea of FMCSA held informal meetings threaten Henlys Group Motor Carrier Safety Administra- developing fed- with the United Motorcoach Asso- BOREHAMWOOD, England – its huge debt and continuing losses – tion has decided against developing eral regulations ciation, the American Bus Associa- Henlys Group PLC, the British is problematic. regulations that would require that would re- tion and the Commercial Vehicle company that lays claim to being Henlys, which is headquartered motorcoach operators to conduct quire motor- Safety Alliance to discuss the the largest manufacturer of buses in the London suburb of Boreham- passenger safety briefings. coach passenger NTSB recommendations. and coaches in the U.S. and Can- wood, Hertfordshire, owns 100 per- In a letter and memo to the Na- safety briefings – Those meetings resulted in the tional Transportation Safety Board, similar to those formation of a working group to ada, has been beaten to a pulp by cent of Blue Bird Corp., the largest FMCSA Administrator Annette on airlines – has Annette Sandberg consider the issue. Included in the the prolonged slump of the North school bus maker in the U.S., and Sandberg said that “creation of a been under active consideration by working group were representatives American bus market and problems half of Prevost Car and its subsidiary, regulatory requirement for motor- the FMCSA for more than a year. from Greyhound Lines, Coach at its school bus manufacturing sub- Nova Bus. Volvo Bus Corp. owns coach operating companies to con- The impetus for mandated briefin- USA, Setra, Prevost Car, Motor sidiary. the other half of Prevost and Nova duct pretrip safety briefings for pas- gs came from two recommenda- Coach Industries, Daecher Con- In a series of rapid-fire develop- Bus. sengers is not the optimum tions made by the NTSB. sulting Group, UMA and three ments in mid-June, Henlys revealed “The board’s aim is to achieve a approach due to the composition of The federal crash investigation federal agencies. that its shares are largely worthless restructuring which preserves the the industry. agency had urged the FMCSA to The working group concluded and it’s having them delisted on the group’s principal operating business- “That is, the majority of the require motorcoach operators to that the best approach for dealing London Stock Exchange. Addition- es in North America and offers sig- motorcoach operating industry is provide passenger safety briefings with the issue was to develop alter- ally, it has named two turnaround nificant prospects for an enhance- composed of small companies with and said the FMCSA ought to pro- native approaches to the imposi- specialists to its top executive posi- ment of operating performance, fewer than 10 buses each,” said Sand- vide guidance to motorcoach oper- tion of federal regulations. The tions and it’s working with its banks leading in turn to improvements in berg. “Moreover, there is wide opera- ators on the minimum information final recommendation was for the and other creditors to try to salvage value in the longer term,” Henlys tional variance in the industry, mak- that should be included in such FMCSA to aggressively promote the company. said in a statement. ing it inappropriate to apply one basic briefings. motorcoach safety best practices Whether it will succeed – given þ regulatory approach universally.” In the spring of last year, the CONTINUED ON PAGE 12 CONTINUED ON PAGE 14 þ 1997 T945 VIN 28580 Seats 11, Jacuzzi Tub w/shower, Full Size Refrigerator, 2 Burner Cook Top 1999 T945 VIN 29759 Shower, 2 Refrigerators, Restroom, Alum. Wheels, B500R Trans. 1996 T845 VIN 28537 B500 Trans., Corian Counter Tops, 1998 T945 Dual Refrigerator VIN 29707 12 Bunks, Michelin Tires, In-Motion Satellite Converted by Caldwell 1999 T945 Coach, B500 Trans. VIN 29742 Seats 26, Corian Counter Tops, In-Motion Satellite, Deluxe A/V, Trash Compactor 2000 T945 VIN 29741 12 Bunks, w-Shower, 1999 T945 Tow Hook, Goodyear Tires, VIN 29710 B500R Trans. 12 Bunks, 2 TV’s with Video Cassette, Refrigerator, Microwave, 2 Stereos 1996 T845 2000 T945 VIN 28492 VIN 29731 Seats 22, Corian Counter Tops, 12 Bunks, w-shower, In-Motion Satellite, Full Size Microwave, Corian Refrigerator Counter Tops, B500 Trans. BUS & MOTORCOACH NEWS — July 1, 2004 — 3 OPERATOR NEWS Transit agency in Ohio violated federal rules ZANESVILLE, Ohio – An the Ohio Department of Transpor- Four of the complaints lodged inquiries received by the transit various other services in violation investigation of South East Area tation which conducted an inquiry by Advanced Coach were deter- agency to specific firms on a dispro- of federal charter service rules. Transit by the Ohio Department of into services provided by South East mined to be unfounded, including portionate basis. “In light of the existence of Transportation has found the pub- Area Transit. ODOT Administrator two allegations that SEAT violated ODOT did confirm, however, known willing and able private lic transit agency violated federal Marianne E. Freed said her agency federal rules by entering into con- SEAT was providing transportation charter operators, SEAT is advised transit rules, including providing was able to verify that some of tracts for charter service with the well beyond its service area. In fact, that it is not permitted to operate bus service outside its service area. Advanced Coach’s allegations were Muskingum County Department of on occasion it traveled all the way services which do not meet this The investigation was prompt- founded, while others were deter- Jobs and Family Services and a to Cleveland, a distance of roughly exception, or any of the other iden- ed by a half-dozen complaints filed mined to be unfounded. social service agency. 145 miles. Freed’s office issued a tified exceptions, unless an agree- with the Federal Transit Adminis- She said ODOT conducted its The other unfounded com- cease-and-desist order to stop ment has been reached to do so tration by Advanced Coach, a tour investigation by sorting through plaints had to do with whether SEAT from providing service that with the willing and able charter and charter operator based in the various documents submitted SEAT costs were fully allocated in is outside its service area. companies,” Freed said. Zanesville. by Advanced Coach and address- bidding for transit services, and Additionally, the investigation Advanced Coach is headed by The FTA sent the complaints to ing each of the allegations.
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