[Federal Register Volume 64, Number 17 (Wednesday, January 27, 1999)]
[Notices]
[Pages 4174-4175]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-1886]


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DEPARTMENT OF TRANSPORTATION

Surface Transportation Board
[STB Docket No. MC-F-20943]


Coach USA, Inc. and Coach Canada, Inc.--Control--Autocar 
Connaisseur, Inc.

AGENCY: Surface Transportation Board.

ACTION: Notice Tentatively Approving Finance Transaction.

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SUMMARY: Coach USA, Inc. (Coach), a noncarrier that controls numerous 
motor passenger carriers, and its wholly owned noncarrier subsidiary, 
Coach Canada, Inc. (Coach Canada) (collectively, applicants), filed an 
application under 49 U.S.C. 14303 for control of Autocar Connaisseur, 
Inc. (Autocar II), an entity that intends to become a motor carrier of 
passengers. Persons wishing to oppose the application must follow the 
rules under 49 CFR 1182.5 and 1182.8.1 The Board has 
tentatively approved the transaction, and, if no opposing comments are 
timely filed, this notice will be the final Board action.
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    \1\ Revised procedures governing finance applications filed 
under 49 U.S.C. 14303 were adopted in Revisions to Regulations 
Governing Finance Applications Involving Motor Passenger Carriers, 
STB Ex Parte No. 559 (STB served Sept. 1, 1998).

DATES: Comments must be filed by March 15, 1999. Applicants may file a 
reply by April 5, 1999. If no comments are filed by March 15, 1999, 
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this notice is effective on that date.

ADDRESSES: Send an original and 10 copies of any comments referring to 
STB Docket No. MC-F-20943 to: Surface Transportation Board, Office of 
the Secretary, Case Control Unit, 1925 K Street, N.W., Washington, DC 
20423-0001. In addition, send one copy of comments to applicants' 
representatives: Betty Jo Christian and David H. Coburn, Steptoe & 
Johnson LLP, 1330 Connecticut Avenue, N.W., Washington, DC 20036.

FOR FURTHER INFORMATION CONTACT: Joseph H. Dettmar, (202) 565-1600. 
[TDD for the hearing impaired: (202) 565-1695.]

SUPPLEMENTARY INFORMATION: Coach currently controls a number of motor 
passenger carriers. Coach Canada is a wholly owned Coach subsidiary 
established for the purpose of obtaining control of those motor 
passenger carriers that Coach currently controls that are based in 
Canada, as well as Canada-based motor passenger carriers that Coach and 
Coach Canada may in the future seek to control. In their application, 
Coach and Coach Canada state that Coach assumed control of Autocar 
Connaisseur, Inc. (Autocar I) by a stock transaction that was 
consummated on December 19, 1996. Applicants indicate that Coach did 
not until recently determine that Autocar I holds not only operating 
authority from Canadian agencies, but also authority issued by the 
Interstate Commerce Commission. Having discovered this unresolved 
control issue, Coach and Coach Canada sought Board authority in STB 
Docket No. MC-F-20938 to control this carrier.2
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    \2\ Autocar I is a Quebec corporation. It holds federally issued 
operating authority in Docket No. MC-166643, allowing it to conduct 
charter and special operations between certain U.S./Canada border 
crossings and points in the United States. Autocar I operates a 
fleet of approximately 180 buses and employs approximately 250 full 
and part time persons. Autocar I's annual revenues for the twelve 
month period ending June 1998 were approximately $12.1 million. 
Autocar II will undertake the same business operations now conducted 
by Autocar I.
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    Applicants state that, under Canadian law, Autocar I is to be 
amalgamated (merged) with three other noncarrier entities with which it 
is affiliated by common ownership: Connaisseur Parts Distribution, 
Inc., Agencie de Vehicules Connaisseur, Inc., and 170861 Canada, Inc. 
Applicants aver that each of these four corporations now shares common 
ownership with Autocar I, and that the ultimate parent of each within 
the Connaisseur Group of companies is 3329003 Canada, Inc., a 
noncarrier owned by Coach. Applicants further contend that the product 
of the amalgamation transaction will be a new corporate entity also to 
be known as Autocar Connaisseur, Inc. (Autocar II). Applicants state 
that, following the amalgamation, Autocar II will carry on the same 
motor carrier business now conducted by Autocar I, under the same 
management that now operates Autocar I, and pursuant to the same 
operating authorities now held by Autocar I. Applicants aver that the 
amalgamation will in fact be ``invisible'' to Autocar's customers.
    Applicants state that granting the application will not result in 
any changes to carrier operations that are now being conducted and will 
not reduce competitive options available to the traveling public. They 
assert that Autocar II is relatively small and will face substantial 
competition from other bus companies and modes of transportation.
    Applicants also submit that granting the application will produce 
substantial benefits, including reduced fixed charges in the form of 
interest cost savings from the restructuring of debt and reduced 
operating costs from Coach's enhanced volume purchasing power. 
Specifically, applicants claim that Autocar II will benefit from the 
lower insurance premiums negotiated by Coach or Coach Canada and from 
volume discounts for equipment and fuel. Applicants indicate that Coach 
will provide Autocar II with centralized legal and accounting functions 
and coordinated purchasing services. In addition, applicants state that 
vehicle sharing arrangements will be facilitated through Coach or Coach 
Canada to ensure maximum use and efficient operation of equipment. 
Applicants aver that, with Coach's and Coach Canada's assistance, 
coordinated driver training services will be provided, enabling Autocar 
II to allocate driver resources in the most efficient manner possible. 
Applicants add that the proposed transaction will have no adverse 
impacts on the employees of Autocar II and that collectively bargained 
agreements will be recognized.
    Applicants state that Coach Canada, like other management 
subsidiaries that Coach has established to assume control of, and 
manage the operations of, motor passenger carriers as to which control 
authority has previously been granted to Coach, will focus its efforts 
on those carriers that are based in Canada. Applicants also indicate 
that Coach Canada will be responsible for developing strategic business 
and growth plans for the Canadian based entities that it seeks to 
control, and for assessing opportunities for further Canadian 
acquisitions of passenger transportation entities. Applicants add that, 
over the long term, Coach and Coach Canada will provide centralized 
marketing and reservation services for the bus firms that they control, 
thereby further enhancing the benefits resulting from these control 
transactions.
    Applicants certify that: (1) Autocar II does not hold an 
unsatisfactory safety rating from the U.S. Department of

[[Page 4175]]

Transportation;3 (2) Autocar II will maintain sufficient 
liability insurance; (3) Autocar II is not domiciled in Mexico or owned 
or controlled by persons of that country; and (4) approval of the 
transaction will not significantly affect either the quality of the 
human environment or the conservation of energy resources. Additional 
information may be obtained from applicants' representatives.
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    \3\ Autocar I holds a satisfactory rating from the U.S. 
Department of Transportation. Because it will be a new carrier 
following the amalgamation, Autocar II holds no safety rating.
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    Under 49 U.S.C. 14303, we must approve and authorize a transaction 
we find consistent with the public interest, taking into consideration 
at least: (1) the effect of the transaction on the adequacy of 
transportation to the public; (2) the total fixed charges that result; 
and (3) the interest of affected carrier employees.
    On the basis of the application, we find that the proposed 
acquisition of control is consistent with the public interest and 
should be authorized. If any opposing comments are timely filed, this 
finding 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.4 If no opposing comments are 
filed by the expiration of the comment period, this decision will take 
effect automatically and will be the final Board action.
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    \4\ Under revised 49 CFR 1182.6(c), a procedural schedule will 
not be issued if we are able to dispose of opposition to the 
application on the basis of comments and the reply.
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    Board decisions and notices are available on our website 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 acquisition of control is approved and authorized, 
subject to the filing of opposing comments.
    2. If timely opposing comments are filed, the findings made in this 
decision will be deemed as having been vacated.
    3. This decision will be effective on March 15, 1999, unless timely 
opposing comments are filed.
    4. A copy of this notice will be served on: (1) the U.S. Department 
of Transportation, Office of Motor Carriers-HIA 30, 400 Virginia 
Avenue, S.W., Suite 600, Washington, DC 20024; and (2) the U.S. 
Department of Justice, Antitrust Division, 10th Street & Pennsylvania 
Avenue, N.W., Washington, DC 20530.

    Decided: January 21, 1999.

    By the Board, Chairman Morgan and Vice Chairman Clyburn.
Vernon A. Williams,
Secretary.
[FR Doc. 99-1886 Filed 1-26-99; 8:45 am]
BILLING CODE 4915-00-P