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Leading European transport operator Arriva is set to enter the Hungarian and Slovakian bus markets following an agreement to buy 80 per cent of Interbus Invest*, the holding company of Eurobus Invest**, for 8 billion Hungarian Forint (HUF) (c£25.4 million), plus net debt.

Eurobus Invest, the largest privately owned Hungarian bus group, provides regional, urban and contract bus operations in Hungary and Slovakia.  It operates 840 buses and has 1,500 employees.

In Hungary, Eurobus Invest operates through a joint venture company VT-Transman†.  In Slovakia it operates through two 60 per cent owned subsidiaries, SAD Nové Zámky†† in the south west and SAD Michalovce‡ in the east.

Eurobus Invest is not required under Hungarian law to produce consolidated accounts.  Unaudited consolidated figures for Eurobus indicate that revenue for 2006 was approximately HUF 9.5 billion (c£30 million), and Arriva estimates that earnings before interest and taxation (EBIT) based on Arriva’s accounting policies and IFRS, was approximately HUF 900 million (c£2.8 million), generating earnings before interest taxation depreciation and amortisation (EBITDA) of approximately HUF 1.8 billion (c£5.7 million).  Net debt at 31 December 2007 was approximately HUF 200 million (c£0.6 million).

The acquisition, taking the number of countries in which Arriva operates to 12, will provide a platform from which to develop potential opportunities arising from the imminent privatisation in the Hungarian regional bus sector and to consolidate in Slovakia as the state divests its remaining holdings in former state-owned regional bus companies. 

Arriva chief executive David Martin said: “This is a significant milestone for Arriva to enter two new markets with a business that is ready to develop the opportunities arising in those countries and contribute to Arriva’s European growth story.  It builds on last year’s entry into Poland with a tender win and acquisitions in the Czech Republic, further consolidating Arriva’s position in new markets.”

The acquisition is conditional on competition/regulatory clearance in Slovakia, which is expected in the summer.  HUF 300 million (c£0.95 million) of the consideration will be retained until 2011, payment being conditional upon achievement of defined EBITDA targets and the level of net debt.

Notes to editors:

* Eurobus-Invest Regionàlis Közlekedésfejlesztési (Eurobus Invest)
** Inter-Bus Invest Befektetési Zrt (Interbus Invest)
† VT-Transman Személyszállító és Szolgáltató Kft. (VT-Transman)
†† Slovenská autobusová doprava Nové Zámky akciová spolocnost (SAD Nové Zámky)
‡ Slovenská autobusová doprava Michalovce akciová spolocnost (SAD Michalovce)

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