Travel Startup FlixMobility Acquires Greyhound Lines for $172 Million

German transportation company FlixMobility announced Oct. 21. 2021, that it will be acquiring Greyhound Lines, one of the biggest transportation services in North America. FlixMobility will purchase Greyhound for $172 million, as FlixMobility will look to expand its U.S. services. FlixMobility has its own intercity bus service in the U.S. with its FlixBus brand, and, combined with the Greyhound buses, the German company will be able to reach more states in the country.

FlixMobility will be purchasing Greyhound Lines from FirstGroup, a British transportation company that operates in the U.K. and U.S. With the sale of the bus service, the British company will be focusing more on its services in the U.K. Both companies agreed that FirstGroup will retain Greyhound properties and lease them out to FlixMobility throughout the next few years.

FirstGroup had been seeking buyers since May 2019, when airlines and gas prices were very affordable. Being able to fly or refill a car’s gas tank cheaply made it difficult for the coach bus service to compete. The British company didn’t choose a buyer until now.

FirstGroup originally purchased Greyhound in 2007, as a part of a deal with its former parent company, Laidlaw International. Laidlaw was the biggest bus service provider in both the U.S. and Canada at one point. FirstGroup purchased the transportation company for $3.6 billion. Laidlaw played a huge role in the success of bus transportation for decades, whether it was intercity transportation, school bus services, or contract bus services.

When FirstGroup purchased Greyhound, it already owned Ryder Public Transportation Services, which was one of the largest school bus companies in America. After the deal between FirstGroup and Laidlaw was completed, FirstGroup reportedly owned over 40 percent of the U.S. school bus contractor market.

FirstGroup had a big hold on the transportation industry, having subsidiaries in services involving railroads, coach buses, and school transportation. Fast forward to 2021, and FirstGroup is selling off different U.S. branches.

In Dec. 2020, FirstGroup reportedly sold major Greyhound facilities in America and Canada, for over 100 million British pounds ($137 million). Then, in April 2021, it sold a majority of its North American transportation business—two major companies, First Student and First Transit.

First Student was one of the largest school bus services in America, while First Transit provided intercity bus services and other methods of transportation. Investment company EQT Infrastructure purchased both companies for over 3 billion pounds ($4 billion). As it continues to sell its North American subsidiaries, FirstGroup wants to focus on its U.K. bus and railroad operations.

FlixMobility focuses on its main brand, Flixbus, the largest intercity bus network in Europe. It has also expanded its services to America. It’s very similar to Greyhound, as it offers coach buses with WiFi in various states. The company, focused on affordability and eco-friendly travel, is currently looking to introduce all-electric bus services in Germany, the U.S., and France.