In The News

KPS Special Situations Fund, L.P. Makes A Controlling Investment In Transit Bus Manufacturer, New Flyer Industries, Ltd.

Mar 18, 2002

New York, NY (March 18, 2002) – The KPS Special Situations Fund, L.P. ("KPS") today made a controlling investment, through an affiliate, in New Flyer Industries, Ltd. ("New Flyer"), the leading producer of transit buses in North America, pursuant to a multi-stakeholder recapitalization and restructuring of the Company.

New Flyer is headquartered in Winnipeg, Manitoba and has two additional production facilities in St. Cloud and Crookston, Minnesota. With over $700 million CDN in revenue in 2001 and over 1,500 employees, New Flyer is the market share leader of transit buses in North America, serving most of the major municipalities and transit agencies throughout the United States and Canada.

The transaction is the culmination of nearly one year of restructuring efforts at New Flyer and involved the participation of virtually all of the Company's primary stakeholders. David Shapiro, a Managing Principal of KPS said, "The New Flyer acquisition fits perfectly with KPS's constructive approach to investing. The transaction could not have been completed without the contributions of numerous important stakeholders, including the Province of Manitoba through its Manitoba Development Corporation, the Company's key suppliers, customers and lenders, all of its employees and the leadership of its two unions, the Canadian Auto Workers Union (CAW) in Winnipeg and the Communications Workers of America (CWA) in Crookston, as well as the federal government of Canada through its Western Economic Development Fund.

KPS invested $44 million CDN of equity in the transaction and the Province of Manitoba invested $20 million CDN in the form of a subordinated loan. All of the net proceeds invested by KPS and the Province will be retained in the Company to recapitalize the Company's balance sheet and to fund normal operations. In connection with the KPS investment, New Flyer issued new shares of common stock to KPS. The founding shareholder, Mr. Jan den Oudsten will retain a minority stake in New Flyer. He will stay on as the Company's non-executive chairman and will be involved in certain special projects. A new chief executive officer will be named shortly.

"We look forward to building upon the very solid foundation that exists at New Flyer, continuing its commitment to innovation and industry leadership and providing its customers with the highest levels of quality and service. We believe the Company is in excellent shape operationally and financially, with a vastly improved balance sheet and enhanced liquidity position," continued Mr. Shapiro.

New Flyer represents the seventh completed transaction for KPS and its second in the transportation industry. KPS Special Situations Fund, L.P., managed by Eugene Keilin, Michael Psaros and David Shapiro, is a New York City-based private equity fund focused on constructive investing in restructurings, turnarounds, and other special situations. More information on KPS, its portfolio companies and investment strategy can be found at

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