Sir Brian Souter
Sir Brian Souter

Scottish bus manufacturer Alexander Dennis Limited (ADL) has been acquired by Toronto Stock Exchange-listed NFI Group Inc. (NFI) which also manufactures buses.

ADL’s proven products and successful track record of entering and growing new markets will complement NFI’s product offering, diversify its business model and create a platform for international growth, accelerated technology development and innovation.

With a long history spanning more than a century, ADL has over 31,000 vehicles in service in the UK, Europe, Hong Kong, Singapore, New Zealand, Mexico, Canada and the United States sold under the Alexander Dennis and Plaxton brands.

NFI is North America’s largest and most diversified bus manufacturer providing transportation solutions under the brands: New Flyer®, ARBOC®, MCI®, and NFI Parts™.

Tracing its roots back to 1930, NFI has over 74,000 vehicles in service in Canada and the United States.

Paul Soubry, NFI’s President and Chief Executive Officer said “This is a transformational acquisition for NFI to become a global bus manufacturer.

“ADL is the UK’s number one bus manufacturer and the number one global producer of double-deck buses, with an established international presence and is recognized as a leader known for innovative products and a commitment to quality and service. We’re thrilled to have ADL join the NFI family in a transaction that we believe will drive our business forward by combining joint strengths in engineering, sales, new product development and manufacturing with NFI’s expertise in Operational Excellence, insourcing, fabrication and systems management.”

ADL was established in 2004 when a consortium of Scottish entrepreneurs led by Sir Brian Souter and including Dame Ann Gloag, Sir Angus Grossart and Sir David Murray acquired the business from TransBus International’s administrators.

Since 2004 ADL has gone from strength to strength and demonstrated a track record of consistent growth.

In 2018 ADL generated revenues of £631 million, having grown revenue at a compound annual growth rate of 10.5% since 2010, and the Company delivered more than 2,500 buses and coaches across the Company’s domestic UK market and multiple international territories.

ADL’s Chief Executive Officer, Colin Robertson, who has driven the growth and internationalisation of the Company over more than 10 years, and Chief Financial Officer, Michael Stewart, will continue to lead ADL as well as head-up NFI’s international growth ambitions.

“We are incredibly proud of the growth and success we’ve had building Alexander Dennis over the past 15 years, and I’m excited to have the ADL team join NFI – one great bus company joining another”, said Colin Robertson. “We believe our consolidated businesses will enhance NFI’s market leading position in North America, while improving NFI’s offering through combined engineering expertise, supplier partnerships, electric vehicle know-how and aftermarket platforms.”

Mr. Robertson added, “I look forward to continuing our solid progress at ADL and also championing further international growth for NFI in coordination with Paul and his leadership team”.

Souter Investments will retain an equity interest in NFI and ADL going forward having been issued shares in NFI Group Inc. as part of the transaction.

Sir Brian Souter, Chairman of Souter Investments, commented: “Colin, Michael and their team atADL have built a fantastic market leading business. Having been involved with ADL since 2004, I have witnessed the transformation of the Company into a truly international business with an exceptional product portfolio, a reputation for innovation and design and engineering excellence, and a first- class approach to customer service.”

John Berthinussen, Investment Director at Souter Investments added: “The sale of ADL continues an extremely active period at Souter Investments where we have made several new investments, supported our businesses with follow-on capital, and completed a number of successful sales. Our primary focus remains on private equity investing, where we are not constrained by fund rules or specific investment hold periods and can offer flexible and supportive institutional capital, tailored to the specific business and situation we are investing in.”

Lazard acted as financial advisors for certain ADL shareholders, Deloitte and Roland Berger provided vendor due diligence services, and CMS, Dickson Minto and Pinsent Masons acted as legal advisors.