CMAC set to 'turbo-charge' growth after £80m sale

By Ged Henderson

18 Mar 2024

CMAC Group New Office

The acquisition of Accrington based managed transport specialist CMAC Group by one of the world’s largest land transport companies will “turbo-charge” its growth, predicts chief executive Peter Slater.

Revealing the background behind the £80m-plus deal with the Singapore headquartered ComfortDelGro Corporation, he said the sale was the culmination of a decade of planning and hard work.

CMAC has made headlines in recent years through its own ambitious acquisitions, growing to £150m turnover and a 350-strong workforce, with 40 per cent of its business based outside the UK.

The company has made its name as an expert in ground travel solutions, including managing alternative transport and accommodation for airlines affected by disruption such as severe weather, strike action, national disasters and technical and operational problems.

Today it has operations in the UK, Spain, Portugal, Greece and The Netherlands, managing journeys for close to three million travellers annually on behalf of airlines and ground handlers, train operators, corporations and consumers.

Through its Suntransfers brand, CMAC, which was founded in 2007, provides private and share-ride transfers to more than 500 airports, stations and ports worldwide.

Its acquisition, through ComfortDelGro Corporation’s wholly-owned UK subsidiary CityFleet Networks, was announced last month. CMAC will remain operationally independent and led by its current senior team, with Peter remaining in his role.

He told Lancashire Business View: “We’ve picked the right partner, not only because of the financial fire-power it has but also because it is strong in areas and territories we aren’t.

“They’ve got an acquisition pipeline that is pretty impressive and a good team we are working closely with. We couldn’t be happier at the moment.

“All the acquisitions we have made have been self-funded, with a little bit of help from the bank. We’d been extremely successful but had more or less hit a glass ceiling and this will turbo-charge our growth.”

ComfortDelGro operates in seven countries and has a global network of about 34,000 vehicles. The company has a group annual revenue of S$3.8bn (£2.2bn) and is listed on the Singapore Stock Exchange

Peter said the planning behind the sale could be traced back over a decade, including a key brainstorming session in a hotel in Skipton some four years ago, held to explore all available options.

He said: “We looked at where we thought we could take the company over the next five years. It was the first time we’d done anything like that. We discussed potential paths to further growth and decided we would need more firepower.

“We could have taken the private equity route if we’d wanted, there was lots of interest, but we decided it just wouldn’t be suitable for us and the way we manage and operate our business.

“We also looked at a potential flotation which again was dismissed. So, we came to the conclusion a trade sale was our preferred option. We wanted someone to come to the table that understood the industry and was interested in us carrying on and, if anything, accelerating that growth.”

To that end, a list of the big players in the sector was drawn up at the time, which included ComfortDelGro. Business advisors were then drafted in to examine and explore sale opportunities.

But with the world grappling with the pandemic there appeared no appetite for a CMAC deal while uncertainty surrounded the future of the travel industry and the project was shelved. Peter said: “People just wanted to wait and see what happened to CMAC after the pandemic.”

The project was revived in 2022, with KPMG appointed by the business to drive it forward.

Its first step was to carry out extensive due diligence on the business before looking at the opportunities for a sale. Peter said: “Its team carried out a really deep dive, the whole process was intensive. We emerged from it with a clean bill of health.”

He revealed ComfortDelGro came to the table early with an offer that was readily accepted.

He added: “It was then the real hard work began. We’ve had ups and downs throughout the process, and at one stage it looked like the deal might be off, but we were able to get back round the table and get it back on course.

“I’m really excited for the future and immensely proud of CMAC’s history and achievements, which wouldn’t have been possible without our fantastic team, valued clients and trusted supply partner network. I’m looking forward to continuing our commitment to delivering a highly valued service as well as being an employer of choice.”

The acquisition is aligned with ComfortDelGro’s strategy to expand its point-to-point mobility services and offerings and it increases the group’s global footprint to 12 countries.

In the UK it owns and operates taxis and private hire vehicles through CityFleet Networks in Aberdeen, Liverpool and the North West. It also operates Metroline buses and Westbus coaches in London, Adventure Travel buses and coaches in Wales, as well as the Megabus, Scottish and Irish Citylink inter-city coach services.

Globally, its joint venture with British transport giant Go-Ahead will assume control of the Stockholm Metro network in 2025. It also operates services in Paris and Auckland, New Zealand. Last year it bought one of Australia’s biggest taxi firms in a £97.6m deal.

ComfortDelGro’s European chief executive Edward Thomas said the CMAC acquisition was aligned with its strategy to expand its “point-to￾point mobility services and offerings”.

He said: “As an established player in providing wide-ranging emergency passenger transport services to businesses, CMAC is complementary to our operations in the UK and Europe, allowing us to expand our business-to￾business offerings in the region.

“In addition, as part of the wider ComfortDelGro Group, CMAC will be able to tap into our deep market knowledge to grow its business and reach.”

Enjoyed this? Read more from Ged Henderson

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