As part of its 'GLOBE 2013' initiative, Daimler Buses is moving to secure sustainable competitiveness through worldwide advances in growth and efficiency. As a result of these efforts, the company is reconfiguring its bus business in North America (U.S. and Canada).
Strategic Partnership planned with MCI to strengthen Setra's coach business in North America
Daimler Buses announced the signing of a Letter of Intent with Motor Coach Industries International Inc. ("MCI") to establish a strategic partnership to combine MCI's product, service and sales network with Setra's North American coach distribution rights and network. The companies have agreed upon the material terms and conditions of the transaction and are working to finalize definitive agreements, which they expect to enter into and consummate not later than May 31, 2012. Upon consummation of the transaction, Daimler Buses would receive a minority ownership stake in MCI, and MCI would become the exclusive North American distributor of the Setra S407 and S417 German-manufactured premium motor coaches.
"The Setra motorcoach represents the highest standards of comfort, performance, customization and quality in a number of key regions worldwide," said Hartmut Schick, Head of Daimler Buses. "We're excited at the prospect of this partnership with MCI, which is a leading manufacturer of coaches in North America with top-flight distribution and service networks in the U.S. and Canada. Under a Setra-MCI partnership, customers will continue to enjoy the same state-of-art technology, quality German engineering, and best total cost of ownership in the market. A strategic relationship with MCI will carry forward Setra's proud tradition in North America, and also take it to the next level -- through increased local presence and enhanced customer services for Setra."
Rick Heller, MCI CEO, said, "The proposed transaction would allow MCI to expand its luxury motor coach offerings in the North America marketplace, while establishing a strategic partnership with one of the world's leading manufacturers of buses and motor coaches. If consummated, we would intend to fully leverage the capabilities of MCI's marketing and distribution networks on behalf of the world-renowned Setra brand. The expected partnership would also allow MCI access to Daimler's world-class Setra engineering and manufacturing capabilities. In addition to our planned consolidation of operations to realize efficiencies and other benefits, the strategic intent of the proposed transaction is to maintain the integrity of the MCI and Setra brands, parts and services."
Under the proposed agreement, through a transition period of several months following the execution of definitive agreements and the closing of the transaction, MCI would evaluate operations related to Setra in North America, and, where appropriate, integrate such operations with existing MCI facilities which will permit MCI and Daimler Buses to realize significant operating synergies. This planned partnership will allow Daimler Buses to better serve its customers through a broader service network, while strengthening Setra's presence in North America. All Setra motor coaches are German-engineered products produced in Neu-Ulm, Germany. This fact remains unchanged.
Daimler anticipates that operations related to Mercedes-Benz Sprinter in Greensboro, NC will be transferred to another Daimler facility.
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