Firstgroup has acquired coach operator Lakeside Group, as the FTSE 250 transport giant continues to expand across the country.
Lakeside, which is based in Shropshire and Cheshire, provides bus and coach private hire services to schools and businesses.
The company owns around 145 buses and coaches, with a small amount of revenue coming from tours and a small local bus operation from Shropshire County Council.
Lakeside has grown significantly in recent years, bringing in £12.5m of revenue and £2.5m for earnings before interest and taxes in the last financial year.
The business is “delivering very attractive margins with a record of organic and inorganic growth”, said Panmure Liberum analyst Gerald Khoo.
Managing director of Lakeside Neal Hall will continue to run the day-to-day of the business, while Lakeside’s owner Gareth Davies will continue to lead the business and join Firstgroup bus business, First Bus.
The acquisition matches other that Firstgroup has made in recent years in an attempt to grow and diversify its bus arm, which now bringing in £100m in revenue a year.
“The acquisition of Lakeside, a profitable business with excellent growth potential, builds on our recent acquisitions in First Bus,” said Firstgroup CEO Graham Sutherland.
“The addition to our portfolio will not only grow our position in adjacent services, but it will also allow us to enter new regions which is key to the overall First Bus strategy.”
“The annualised run rate of adjacent services is now about 10 per cent of divisional revenue, with margins above the divisional average highlighting the attractiveness of the business,” added Khoo.