In May 2012, Next Capital acquired a material interest in GoBus, an operator of urban, school and charter bus services throughout New Zealand, with leading market positions in four of the six largest public transport markets (Hamilton, Napier, Tauranga and Christchurch).
Investment highlights included:
- Strong competitive positioning as a low-cost, flexible bus operator
- Solid earnings stream stemming from long term government contracts with limited revenue and margin risks
- Pipeline of growth opportunities given the fragmented nature of the New Zealand bus industry and the impact of regulatory initiatives
- Experienced management team with proven capability in driving organic and inorganic growth
Next Capital worked closely with the management team to create value by:
- Transforming the business from being a regional operator to a national business through the acquisition of four smaller operators
- Successfully established operations in Auckland, New Zealand’s largest bus market, to provide a platform to improve competitiveness on future tenders
- Established return of capital thresholds to measure asset performance and enhance investment decisions
- Strengthened the management team through the addition of a Business Development Manager with a focus on executing on the growth plan
Go-Bus was sold to a financial buyer in September 2014.