Cabcharge has sold its 49% interest in private bus business ComfortDelGro for $186 million, raising the prospect of a special payout to shareholders.
The payment service and taxi network company offloaded what it now considers a non-core asset to its joint venture partner ComfortDelGro Corporation Limited.
A short time ago, Cabcharge shares were up almost 3% to $3.985.
Chairman Rick Millen says the board is evaluating the most efficient use of the proceeds.
“Priority will be given to reducing Cabcharge’s debt, and positioning the company to invest further in growth initiatives that enhance passenger and driver experience,” he says.
“The board intends to distribute available surplus net proceeds to shareholders and will consider the options to achieve this before providing further detail on completion of the sale.”
CEO Andrew Skelton says the personal transport sector has undergone enormous change, both regulatory and competitive.
“We know that to capture the tail winds of this growing market, in terms of both trips and electronic payments, we must evolve and invest,” he says.
“The transaction allows us to make strategic investments that will reward our shareholders over the long term.”