KIT to acquire 98.6% stake in Victoria, Australia’s largest bus service business

The business trust will acquire the business for an enterprise value of $540m.

Keppel Infrastructure Trust (KIT) will acquire a 98.6% stake in Ventura Motors (Ventura) for an enterprise value of $540m (A$600m).
KIT expects to complete the transaction in 2Q24, subject to the conditions precedent, including approval from the Australian Foreign Investment Review Board and consent from the Head of Transport for Victoria. 

Keppel Infrastructure Fund Management (KIFM), the trustee-manager of KIT, plans to fund the investment with an optimal combination of internal sources of funds, equity and/or debt capital market issuances and/or external borrowings. 

Upon completion of the transaction, KIT’s assets under management will grow from $8.1b as of 2 January to approximately $8.7b.

Following the acquisition, Andrew Cornwall, managing director of Ventura, will remain on as Chief Executive Officer.

Ventura is the largest bus service business in the State of Victoria, Australia, transporting more than 42 million people annually.

Ventura’s fleet comprises 900 buses and 12 depots. It has the largest market share of public bus services in Victoria, operating approximately 530 routes out of Melbourne’s ~1,200 total routes.

“Over 80% of Ventura’s revenues are derived from long-term government route services, which means that the majority of Ventura’s income does not fluctuate with the volume of passengers or fares collected and provides inflation-protected revenues,” KIT explained.

“Besides operating government route services, Ventura is also one of the largest bus charter service businesses in Victoria, servicing about 150 schools, as well as providing bus services for tourism destinations and general charter,” KIT added.