WALL, N.J. — Student Transportation Inc. (STI), North America’s third-largest school bus contractor, has entered into a definitive agreement to be acquired by a group of investors, the company announced on Tuesday.
A company sponsored by Caisse de dépôt et placement du Québec (CDPQ) and Ullico Inc. will acquire all of STI’s outstanding common shares. Shareholders will receive US$7.50 per common share in cash.
Denis Gallagher, chairman and CEO of STI, said that CDPQ has been invested in the company for 16 years, most of that time as the largest shareholder. With the announcement of the acquisition, Gallagher noted that STI will remain focused on its mission.
“We will continue to be the North American leader in student transportation, and our unwavering commitment to our employees, customers, safety, service, and innovation will remain unchanged," he said.
Gallagher founded STI in 1997. Just over 20 years later, the company now transports 1.25 million students in the U.S. and Canada with a fleet of 13,500 school buses.
CDPQ is an institutional investor that manages public pension plans and insurance programs in Quebec. Macky Tall, executive vice president of infrastructure for CDPQ and president and CEO of CDPQ Infra, said that the acquisition of STI “represents a significant new step in our relationship with the company, and we look forward to working with the management team for years to come.”
Ullico is a labor-owned insurance and investment company based in Washington, D.C. Rohit Syal, head of acquisitions for Ullico's infrastructure business, added that the company "is pleased to partner with CDPQ to invest in this transaction and has been impressed with the dedication and accomplishments of STI's management and workforce."
The acquisition is subject to customary closing conditions, including court approval and approval of two-thirds of the votes cast by holders of common shares. The transaction is expected to close by the end of the second quarter of 2018.