Ann: Trading Halt, page-2

Street Talk

Transport group Kelsian hits M&A market, lines up funding

Anthony Macdonald, Sarah Thompson and Kanika Sood

Mar 13, 2023 –10.14pm

Ferryand bus operator Kelsian Group’s set to pitch equity investors for a $300million capital injection, with proceeds pegged for an acquisition in theUnited States.

It isunderstood Kelsian has had Macquarie Capital’s bankers lining up fund managersto tip into the raising, promising them a look at the M&A target andassociated equity deal’s price and terms as early as Tuesday.

Kelsianshares are expected to be halted from trading while the company and its brokersline up acquisition funding.

Thedeal was slated to launch on Wednesday.

It’snot known what Kelsian has agreed to buy, although the group’s been activechasing bus contracts in the UK in the past year and talked up “inorganic”growth options at its half-year results in February.

Kelsiantold shareholders it was assessing “strategic acquisition opportunities inUK/Europe/USA and bolt on acquisitions in Australia”.

Kelsian,formerly Sealink Travel Group, has been a busy dealmaker during its neardecade-long stint on the ASX-boards.

Mostnotably, the company acquired Transit Systems Group, Australia’s largestprivate operator of public bus networks, in January 2020, in a $635 millioncash and scrip deal supported by an equity raising.

Itchanged its name soon after, to reflect the change in its underlying businessfrom ferries to a wider transport offering.

Kelsianshares are down 8.5 per cent in the past year, although have been a strongperformer on a five-year basis (+61 per cent). It’s closely followed byAustralia’s small cap managers, with the group worth $1.4 billion on a marketcapitalisation basis on Monday.