Fourth Largest School Bus
Provider Eyes New Business

TORONTO (April 15, 2008) — Just in time for the U.S. income tax filing deadline, the fourth largest private school bus service provider in North America announced new growth potential that could potentially reach into Europe after raising $50 million in additional revenue following the sale of more than 8.2 million private shares to a subsidiary of the French National Railway and to global fund manager Caisse de dépôt et placement du Québec.

A company press release said the net proceeds will go towards funding “future growth opportunities, including acquisitions, new contract bids and conversions and repay amounts of outstanding under its growth credit facility.” In January, STA rose to its current position as the fourth largest school bus contractor in both the United States and Canada following its acquisition of Canadex Resources Limited in Toronto’s Golden Horseshoe Region, the 31st for STA since Chairman and CEO Denis J. Gallagher started the company in 1997.

The latest STA deal, expected to close Friday, included Caisse buying $9 million in shares to become STA’s largest shareholder at 18.3 percent. The 43-year-old investment company first invested in STA when it was a private company and again when the school bus contractor went public in December 2004. Meanwhile, the purchase of $40 million worth of shares by SNCF Participations S.A., more than 99 percent-owned subsidiary of the Société Nationale des Chemins de fer Français (SNCF), brought the French National Railway’s ownership in STA to 6.4 percent. STA also expanded its board of directors to eight members to accommodate the addition of Jean-Pierre Farandou, director of SNCF’s public transport division.

“European investment in school buses in the U.S. is nothing new,” commented an STA representative.

There has been a push in recent years to increase the presence of the yellow school bus throughout England. FirstGroup of Aberdeen, Scotland, purchased Laidlaw last year and, in the process, its First Student North American school bus operations took the majority school bus contractor market share. National Express Corporation is the North American subsidiary of London’s National Express Group, PLC. It operates Durham School Services in the United States and Stock Transportation in Canada.

Atlantic Express, the third-largest school bus contractor in the nation, remained the only domestically-held U.S. company.