LONDON: Mobico Group PLC said Monday it has finalized the sale of its North America School Bus business to I Squared Capital, netting upfront proceeds of $364 million (£273 million), and increasing the company’s financial flexibility heading into 2025.
The transaction, first announced on April 25, closed on July 14 following approval from the U.S. Surface Transportation Board earlier in the month. The total enterprise value of the deal is expected to reach up to $608 million (£457 million), subject to an earn-out arrangement of $70 million based on revenue, EBITDA and free cash flow targets.
Mobico said the proceeds will be used to reduce debt, including leasing obligations, supporting its plan to lower FY 25 covenant gearing to approximately 2.5x by year-end. The company reaffirmed its guidance for FY 25 Adjusted Operating Profit, which remains projected in the range of £180 million to £195 million, excluding contributions from the School Bus unit.
The Group emphasized its robust liquidity position, with no major debt maturities expected until the second half of 2027. It plans to publish interim results for HY 25 on September 9, which will include a non-underlying charge related to impairment and foreign exchange reserve reclassifications tied to the disposal.
Mobico said the transaction aligns with its strategy to de-leverage and sharpen operational focus following a period of performance improvement.