82 FR 50928 - Sureride Charter Inc.-Acquisition of Control-McClintock Enterprises, Inc. D/B/A Goldfield Stage & Company

SURFACE TRANSPORTATION BOARD

Federal Register Volume 82, Issue 211 (November 2, 2017)

On October 3, 2017, Sureride Charter Inc. d/b/a Sundiego Charter Co. d/b/a SunExpress Charter Co. (SCI), an interstate passenger motor carrier, filed an application to acquire McClintock Enterprises, Inc. d/b/a Goldfield Stage & Company (the Acquisition Carrier), an interstate passenger motor carrier. The Board is tentatively approving and authorizing the transaction, and, if no opposing comments are timely filed, this notice will be the final Board action. Persons wishing to oppose the application must follow the rules.

[Federal Register Volume 82, Number 211 (Thursday, November 2, 2017)]
[Notices]
[Pages 50928-50930]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2017-23904]


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SURFACE TRANSPORTATION BOARD

[Docket No. MCF 21077]


Sureride Charter Inc.--Acquisition of Control--McClintock 
Enterprises, Inc. D/B/A Goldfield Stage & Company

AGENCY: Surface Transportation Board.

ACTION: Notice tentatively approving and authorizing finance 
transaction.

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SUMMARY: On October 3, 2017, Sureride Charter Inc. d/b/a Sundiego 
Charter Co. d/b/a SunExpress Charter Co. (SCI), an interstate passenger 
motor carrier, filed an application to acquire McClintock Enterprises, 
Inc. d/b/a Goldfield Stage & Company (the Acquisition Carrier), an 
interstate passenger motor carrier. The Board is tentatively approving 
and authorizing the transaction, and, if no opposing comments are 
timely filed, this notice will be the final Board action. Persons 
wishing to oppose the application must follow the rules.

DATES: Comments must be filed by December 18, 2017. The applicant may 
file a reply by January 2, 2018. If no opposing comments are filed by 
December 18, 2017, this notice shall be effective December 19, 2017.

ADDRESSES: Send an original and 10 copies of any comments referring to 
Docket No. MCF 21077 to: Surface Transportation Board, 395 E Street 
SW., Washington, DC 20423-0001. In addition, send one copy of comments 
to SCI's representative: Andrew K. Light, Scopelitis, Garvin, Light, 
Hanson, & Feary, P.C., 10 W. Market Street, Suite 1400, Indianapolis, 
IN 46204.

FOR FURTHER INFORMATION CONTACT: Sarah Fancher (202) 245-0355. Federal 
Information Relay Service (FIRS) for the hearing impaired: 1-800-877-
8339.

SUPPLEMENTARY INFORMATION: SCI states that it is a California 
corporation and an interstate passenger motor carrier. It states that 
it is wholly owned by All Aboard America! Holdings, Inc. (AAAHI), which 
is wholly owned by AAAHI Acquisition Corporation, which is wholly owned 
by AAAHI Intermediate Holdings LLC, which is wholly owned by AAAHI 
Topco Corporation, which is in turn wholly owned by AAAHI Holdings LLC. 
According to SCI, the majority owner of AAAHI Holdings LLC is Tensile 
Capital Partners Master Fund LP, 89.6% of which is owned by Tensile 
Capital Partners LP. SCI further states that none of the entities that 
have a direct or indirect ownership interest in SCI (Ownership 
Entities) possess motor carrier authority or have USDOT Numbers or 
Safety Ratings.
    SCI states that, in addition to SCI, AAAHI wholly owns the 
following passenger motor carriers (the Affiliated Carriers): Hotard 
Coaches, Inc. (Hotard); Industrial Bus Lines, Inc. d/b/a All Aboard 
America (Industrial); Ace Express Coaches, LLC (Ace Express); All 
Aboard Transit Services, LLC (AATS); and All Aboard America! School 
Transportation, LLC (AAAST). According to SCI, the Affiliated Carriers 
exercise substantial independence in running their diverse operations, 
and none of the Ownership Entities hold any controlling interest in any 
regulated bus transportation provider other than the Affiliated 
Carriers.

[[Page 50929]]

    SCI provides a description of each of the Affiliated Carriers, as 
summarized below:
     Hotard is a Louisiana corporation that provides local and 
regional charter services within Louisiana and Mississippi, and to and 
from various points in the continental United States. It holds common 
carrier operating authority from the Federal Motor Carrier Safety 
Administration (FMCSA) as a motor carrier of passengers (MC-143881). 
Hotard operates a fleet of 273 vehicles, of which 80 are full-sized 
motor coaches and the remainder are school buses. The school buses are 
mainly used for employee shuttle services under contract with large 
employers, operating interstate between Texas and Louisiana and 
intrastate within Louisiana.
     Industrial is a New Mexico corporation that provides local 
and regional charter services in Arizona, New Mexico, and Texas. 
Industrial holds common carrier operating authority from FMCSA as a 
motor carrier of passengers (MC-133171). Its fleet consists of 81 full-
sized motor coaches and 13 minibuses.
     Ace Express is a Delaware limited liability company with 
its principal place of business in Golden, Colo. Ace Express operates 
charter, contract, and casino services. It holds common carrier 
operating authority from FMCSA as a motor carrier of passengers (MC-
908184). Ace Express provides charter services with its fleet of 60 
motor coaches and 17 minibuses. Other services are provided on a 
contract basis for corporate and municipal clients.
     AATS is a Delaware limited liability company with its 
principal place of business in Commerce City, Colo. AATS operates 82 
paratransit vehicles that are provided by Denver Rapid Transit 
District, with whom it has a contract to provide paratransit services. 
AATS provides the drivers, maintenance of vehicles, and supervision of 
employees involved in the paratransit service. AATS does not conduct 
interstate passenger operations and thus does not hold passenger 
carrier operating authority from FMCSA. AATS states that it does not 
possess Colorado intrastate passenger carrier authority, as its 
operations are exempt from the need for such authority under Colo. Rev. 
Stat. Sec.  40-10.1-105(e) (2011).
     AAAST is a Texas limited liability company that provides 
transportation for school children under contract with a number of 
school districts in Texas. The school districts typically provide the 
school buses and AAAST provides the drivers, maintenance of vehicles, 
and supervisions of employees. AAAST currently operates 67 buses for 
five school districts. AAAST does not conduct interstate passenger 
operations and thus does not hold passenger carrier operating authority 
from FMCSA. AAAST operates pursuant to intrastate authority issued by 
the Texas Department of Motor Vehicles under Certificate No. 
007050629C.
    SCI states that the Acquisition Carrier is a California corporation 
that holds common carrier operating authority from FMCSA as a motor 
carrier of passengers (MC-191442). The Acquisition Carrier provides 
local and regional charter service in California using 23 full-size 
coaches, five mini-coaches, two vans, and three cars. SCI states that 
the Acquisition Carrier is wholly owned by individuals Kevin and Dalyce 
McClintock (Sellers). According to SCI, the Sellers do not currently 
hold interests in any regulated bus transportation provider other than 
the Acquisition Carrier.
    SCI explains that under the proposed transaction, SCI would assume 
100% control of the Acquisition Carrier.
    Under 49 U.S.C. 14303(b), the Board must approve and authorize a 
transaction that it finds consistent with the public interest, taking 
into consideration at least: (1) The effect of the proposed transaction 
on the adequacy of transportation to the public; (2) the total fixed 
charges that result; and (3) the interest of affected carrier 
employees. SCI has submitted the information required by 49 CFR 1182.2, 
including information to demonstrate that the proposed transaction is 
consistent with the public interest under 49 U.S.C. 14303(b) and a 
statement that the gross operating revenues of SCI, the Acquisition 
Carrier, and the Affiliated Carriers (which as described above are 
under common control with SCI) exceeded $2 million in both interstate 
and intrastate services for the preceding 12-month period ending June 
30, 2017. See 49 U.S.C. 14303(g).\1\
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    \1\ Applicants with gross operating revenues exceeding $2 
million are required to meet the requirements of 49 CFR 
1182.2(a)(5).
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    SCI asserts that the transaction would not have a material, 
detrimental impact on the adequacy of transportation services available 
for the public. SCI further explains that it anticipates that services 
to the public would be improved because the Acquisition Carrier would 
continue to operate, but going forward, it would operate as part of the 
AAAHI corporate family. Under this new ownership, SCI states that the 
AAAHI corporate family intends to use its business and financial 
management skills, as well as its capital, to increase the efficiencies 
and enhance the viability of the Acquisition Carrier, thereby ensuring 
the continued availability of adequate passenger transportation service 
for the public. SCI also states that services currently provided by the 
Acquisition Carrier would continue to be provided under the same name 
currently used to provide such services.
    According to SCI, fixed charges of the Acquisition Carrier are not 
expected to change materially. SCI states that its fixed charges, in 
the form of interest expense, will increase as a result of the 
borrowing of funds used to complete the contemplated transaction. SCI 
states, however, that such an increase is not expected to impact the 
provision of transportation services.
    Regarding the interests of employees, SCI asserts that its current 
intent is ``to continue the existing operations of the Acquisition 
Carrier,'' but that it ``is evaluating its employment needs with a view 
to employing qualified personnel that are currently employed by the 
Acquisition Carrier to operate the relevant services.'' (App. 8.)
    Finally, SCI asserts that the impact of the proposed transaction on 
the regulated motor carrier industry would be minimal and that neither 
competition nor the public interest would be adversely affected, as the 
proposed transaction involves merely the addition of a single 
interstate passenger motor carrier to a previously approved portfolio 
of carriers. See AAAHI Acquis. Corp.--Acquis. of Control--All Aboard 
America! Holdings, Inc., MCF 21071 (STB served Oct. 28, 2016). SCI 
states that the Acquisition Carrier is a relatively small carrier in 
the overall markets in which it competes (providers of charter, mini-
coach, sedan, and van services), and that neither SCI nor any of the 
Affiliated Carriers offer sedan and van services. SCI further asserts 
that there is limited overlap in service areas or in customer bases 
among the Affiliated Carriers and the Acquisition Carrier, and 
``limited overlap in charter services and/or in customer bases of the 
Acquisition Carrier and SCI in [] San Diego,'' which has a variety of 
competitors and service offerings for ground transportation. (App. 10.)
    On the basis of the application, the Board finds that the proposed 
acquisition is consistent with the public interest and should be 
tentatively approved and authorized. If any opposing comments are 
timely filed, these findings will be deemed vacated, and, unless a 
final decision can be made on the record as developed, a procedural 
schedule will be adopted to

[[Page 50930]]

reconsider the application. See 49 CFR 1182.6(c). If no opposing 
comments are filed by the expiration of the comment period, this notice 
will take effect automatically and will be the final Board action.
    This action is categorically excluded from environmental review 
under 49 CFR 1105.6(c).
    Board decisions and notices are available on our Web site at 
``WWW.STB.GOV.''
    It is ordered:
    1. The proposed transaction is approved and authorized, subject to 
the filing of opposing comments.
    2. If opposing comments are timely filed, the findings made in this 
notice will be deemed as having been vacated.
    3. Notice of this decision will be published in the Federal 
Register.
    4. This notice will be effective December 19, 2017, unless opposing 
comments are filed by December 18, 2017.
    5. A copy of this notice will be served on: (1) The U.S. Department 
of Transportation, Federal Motor Carrier Safety Administration, 1200 
New Jersey Avenue SE., Washington, DC 20590; (2) the U.S. Department of 
Justice, Antitrust Division, 10th Street & Pennsylvania Avenue NW., 
Washington, DC 20530; and (3) the U.S. Department of Transportation, 
Office of the General Counsel, 1200 New Jersey Avenue SE., Washington, 
DC 20590.

    Decided: October 30, 2017.

    By the Board, Board Members Begeman and Miller.
Kenyatta Clay,
Clearance Clerk.
[FR Doc. 2017-23904 Filed 11-1-17; 8:45 am]
 BILLING CODE 4915-01-P