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Paramus Based Coach USA Files for Voluntary Chapter 11 Bankruptcy

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the staff of the Ridgewood blog

Paramus NJ, in a significant development, the Paramus-based operator of Megabus, Coach Canada, Dilon’s Bus Co., Go Can Galder, and other bus brands has announced key asset purchase agreements as part of its court-supervised sale processes. These steps are aimed at preserving jobs and ensuring continuous passenger transportation services across the U.S. and Canada.

Key Agreements

1. Renco Group Inc. Affiliate: Coach USA has entered an asset purchase agreement with an affiliate of the Renco Group Inc., Bus Co. Holdings US LLC. This agreement includes the acquisition of certain bus lines and assets of Community Coach. Additionally, the existing Megabus intellectual property and retail operations are part of this transaction. Importantly, U.S. Megabus operations will continue as the company transitions to an existing partnership business model.

2. AVALON Transportation LLC: Further, Coach USA has entered asset purchase agreements with affiliates of AVALON Transportation LLC for several bus lines, including Lenzner, Kerrville, All West, and ACL Atlanta.

Commitment to Continuity

Coach USA is actively pursuing value-maximizing sales for the company’s remaining business segments and assets that are not included in these agreements. Once completed, these transactions are expected to preserve thousands of jobs and ensure uninterrupted services for millions of passengers who rely on the Coach USA transportation network.

The company continues to operate normally, with a steadfast focus on safety and customer service in both the U.S. and Canada. Despite the challenges posed by the COVID-19 pandemic, which significantly reduced ridership and demand, Coach USA remains committed to its mission.

“As we move through this process, our top priority remains safely carrying the millions of passengers who choose our buses each year and working closely with our valued contract customers and transportation agency partners. We appreciate the dedication of our employees to operating with safety as a priority and serving our customers and our communities,” said Derrick Waters, CEO of Coach USA.

Financial and Legal Framework

The transactions are being conducted under Section 363 of the U.S. Bankruptcy Code, with BCH US and Avalon serving as the “stalking horse” bidders. If other qualified bids emerge, the company will conduct auctions, with the stalking horse bidders setting the floors for these processes. Therefore, the proposed transactions are subject to higher and better offers and other conditions.

Coach USA has secured a commitment for debtor-in-possession (DIP) financing, which includes $20 million in new funds. Upon court approval, this financing, along with operational revenue, will support the company during the court-supervised process. The company also plans to pay its vendors and suppliers in full, ensuring smooth operations throughout the sale.

Coach USA’s legal counsel for this process is Alston & Bird LLP, with Houlihan Lokey Inc. serving as financial adviser, CR3 Partners LLC as restructuring adviser, and Spencer M. Ware as chief restructuring officer.

Looking Ahead

With these strategic moves, Coach USA aims to stabilize its operations and continue providing reliable transportation services while navigating the challenges posed by the pandemic. The company’s dedication to its employees, customers, and community remains unwavering as it works through this transition period.

For more information and updates on Coach USA’s ongoing processes, visit the company’s website or contact their customer service team.

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One thought on “Paramus Based Coach USA Files for Voluntary Chapter 11 Bankruptcy

  1. Buy the land – build your perfect sports complex, done !

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