[Federal Register Volume 78, Number 209 (Tuesday, October 29, 2013)]
[Notices]
[Pages 64596-64597]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2013-25582]
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DEPARTMENT OF TRANSPORTATION
Surface Transportation Board
[Docket No. MCF 21055]
Celerity Partners IV, LLC, Celerity AHI Holdings SPV, LLC, and
All Aboard America! Holdings, Inc.--Control--Sureride Charter Inc. d/b/
a Sundiego Charter Company
AGENCY: Surface Transportation Board, DOT.
ACTION: Notice tentatively authorizing finance transaction.
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SUMMARY: All Aboard America! Holdings, Inc. (AHI), Celerity AHI
Holdings SPV, LLC (Celerity Holdings), and Celerity Partners IV, LLC
(Celerity Partners) (collectively, Applicants) have filed an
application under 49 U.S.C. 14303 for their acquisition of control of
Sureride Charter, Inc. d/b/a Sundiego Charter Company (Sundiego). The
Board is tentatively approving and authorizing the transaction, and, if
no opposing comments are timely filed, this notice will be the final
Board action. Persons wishing to oppose the application must follow the
rules at 49 CFR 1182.5 and 1182.8.\1\
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\1\ Due to the Government shutdown, this notice was not able to
be published in the Federal Register within 30 days after the
application was received. All dates and deadlines in this notice
will be calculated based on the date of publication, October 29,
2013.
DATES: Comments must be filed by December 13, 2013. Applicants may file
a reply by December 30, 2013. If no comments are filed by December 13,
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2013, this notice shall be effective on December 14, 2013.
ADDRESSES: Send an original and 10 copies of any comments referring to
Docket No. MCF 21055 to: Surface Transportation Board, 395 E Street
SW., Washington, DC 20423-0001. In addition, send copies of comments to
Applicant's representative: Mark J. Andrews, Strasburger & Price, LLP,
Suite 640, 1700 K Street NW., Washington, DC 20006.
FOR FURTHER INFORMATION CONTACT: Jonathon Binet, (202) 245-0368.
Federal Information Relay Service (FIRS) for the hearing impaired: 1-
800-877-8339.
SUPPLEMENTARY INFORMATION: AHI is a noncarrier corporation established
under the laws of Delaware. A plurality of AHI's stock is held by a
group of investors participating in Celerity Holdings, a noncarrier
limited liability company organized under the laws of Delaware.
Celerity Partners, the managing member of Celerity Holdings, is also a
noncarrier limited liability company organized under the laws of
Delaware. Applicants currently control two carriers, Hotard Coaches,
Inc. (Coaches) and Industrial Bus Lines, Inc. d/b/a All Aboard America!
(Industrial).\2\ Coaches and Industrial hold authority from the Federal
Motor Carrier Safety Administration (FMCSA) as motor carriers of
passengers (license nos. MC-143881 and MC-133171, respectively).
Coaches operates in Louisiana and southern Mississippi, while
Industrial operates in Arizona, New Mexico, and Texas.
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\2\ See Celerity Partners IV, LLC, Celerity AHI Holdings SPV,
LLC, and All Aboard America! Holdings, Inc.--Control--Calco Travel,
Inc., Hotard Coaches, Inc., and Industrial Bus Lines, Inc. d/b/a All
Aboard America!, MCF 21044 (STB served May 11, 2012).
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Sundiego is a California corporation and is controlled through
stock ownership by Richard and Beverly Ann Illes (Mr. and Mrs. Illes),
noncarrier individuals residing in California. Sundiego holds authority
from the FMCSA as a motor carrier of passengers (MC-324772) and holds
an intrastate registration from the California Public Utilities
Commission (CPUC) as a Class B charter-party carrier of passengers.
Applicants state that Sundiego operates 58 full-sized motor coaches and
9 smaller vehicles (including minibuses, vans, and a limousine).
According to Applicants, Sundiego conducts charter, sightseeing, and
various types of shuttle operations for a variety of customers out of
its headquarters in National City, Cal., a suburb of San Diego.
Applicants state that these operations are conducted to, from, and
within California and adjoining states, as well as to Mexico.
Applicants indicate that 65 percent of Sundiego's revenues are derived
from contracted transit and dedicated shuttle operations, with the
remainder from charter operations. Of those charter operations, airport
transfers account for 10 percent and cruise ship transfers account for
4 percent of Sundiego's revenues.\3\
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\3\ Applicants note that Sundiego also holds authority to
operate a network of interstate regular route motor passenger common
carrier operations involving the points of Los Angeles, El Paso, Las
Vegas, and Denver. Applicants state that, because Sundiego does not
currently operate any of these routes, they intend to file to have
that authority revoked.
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[[Page 64597]]
Under the proposed transaction, Applicants seek permission for AHI
(and for Celerity Holdings and Celerity Partners indirectly) to acquire
100 percent control of Sundiego through a stock purchase agreement
(SPA) between AHI and Mr. and Mrs. Illes. According to Applicants, top
management at Sundiego would remain involved in the business after the
acquisition, and Mr. and Mrs. Illes would become minority shareholders
in AHI. Applicants state that closing of the proposed transaction is
scheduled on or about December 10, 2013, if Board approval is obtained
by then.
Under 49 U.S.C. 14303(b), the Board must approve and authorize a
transaction that it finds consistent with the public interest, taking
into consideration at least: (1) The effect of the proposed transaction
on the adequacy of transportation to the public; (2) the total fixed
charges that result; and (3) the interest of affected carrier
employees. Applicants have submitted information, as required by 49 CFR
1182.2, including the information to demonstrate that the proposed
transaction is consistent with the public interest under 49 U.S.C.
14303(b), and a statement that Applicants' motor passenger carriers and
Sundiego's aggregate gross operating revenues for the preceding 12
months exceeded $2 million, see 49 U.S.C. 14303(g).
With respect to the effect of the transaction on the adequacy of
transportation to the public, Applicants state that the proposed
acquisition would have no significant impact because Applicants do not
intend to change substantially the physical operations historically
conducted by Sundiego. Rather, Applicants anticipate enhancing
operations by implementing vehicle sharing arrangements, by providing
coordinated driver training and safety management services, and by
centralizing various management support functions. With respect to
fixed charges, Applicants state that their control of Sundiego would
generate economies of scale that would reduce a variety of unit costs
and that, with its increased market position, Applicants would be able
to access financing on more favorable terms. In addition to better
interest rates, Applicants expect that the combined carriers would be
able to enhance modestly their volume purchasing power, thus reducing
insurance premiums and achieve deeper volume discounts for equipment
and fuel. Applicants state that the transaction would have a positive
impact on employee interests, as the economies and efficiencies
resulting from the proposed acquisition would directly benefit
Sundiego's employees by maintaining job security and retaining or
expanding the volume of available work.
Applicants further state that the acquisition would have no adverse
impact on competition, because the geographic markets in which Sundiego
and Coaches/Industrial compete are adjacent, but do not significantly
overlap. Industrial's primary service areas in Arizona, New Mexico, and
Texas are west of Sundiego's California-based market. Applicants note
that round trips generated by each carrier might extend into
overlapping states, but the beginning and end points seldom, if ever,
overlap between Sundiego and Coaches/Industrial. Applicants also state
that Sundiego faces other competition in both charter and shuttle
services in San Diego and Los Angeles. Further, Applicants note that
services provided under contract and on a ``spot basis'' also face
competition from local and nationwide operators. Applicants state that
competition includes five locally-based carriers, three carriers in the
Los Angeles area, and four large nationwide providers of service.
On the basis of the application, the Board finds that the proposed
acquisition is consistent with the public interest and should be
tentatively approved and authorized. If any opposing comments are
timely filed, these findings will be deemed vacated, and, unless a
final decision can be made on the record as developed, a procedural
schedule will be adopted to reconsider the application. See 49 CFR
1182.6(c). If no opposing comments are filed by the expiration of the
comment period, this notice will take effect automatically and will be
the final Board action.
Board decisions and notices are available on our Web site at
www.stb.dot.gov.
This decision will not significantly affect either the quality of
the human environment or the conservation of energy resources.
It is ordered:
1. The proposed transaction is approved and authorized, subject to
the filing of opposing comments.
2. If opposing comments are timely filed, the findings made in this
notice will be deemed vacated.
3. This notice will be effective December 14, 2013, unless opposing
comments are filed by December 13, 2013.
4. A copy of this notice will be served on: (1) The U.S. Department
of Transportation, Federal Motor Carrier Safety Administration, 1200
New Jersey Avenue SE., Washington, DC 20590; (2) the U.S. Department of
Justice, Antitrust Division, 10th Street & Pennsylvania Avenue NW.,
Washington, DC 20530; and (3) the U.S. Department of Transportation,
Office of the General Counsel, 1200 New Jersey Avenue SE., Washington,
DC 20590.
Decided: October 23, 2013.
By the Board, Chairman Elliott, Vice Chairman Begeman, and
Commissioner Mulvey.
Jeffrey Herzig,
Clearance Clerk.
[FR Doc. 2013-25582 Filed 10-28-13; 8:45 am]
BILLING CODE 4915-01-P