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Executives Bill Gemmell and Russell Cooke plan to build on Boston Coach’s legacy by combining it with Harrison Global’s resources and innovations to expand chauffeured transportation market share.
BOSTON — A legacy brand has combined with an innovative brand in the chauffeured transportation world, generating one of the most talked-about and closely watched acquisitions in the history of the industry.
The two established Boston brands — the venerable Fidelity-owned Boston Coach, founded in 1986, and the entrepreneurial Harrison Global, founded in 1982 — are consummating a major deal first reported May 22 and closed on July 8 that will result in the Boston Coach brand enduring and growing. Since May, the management team has been working overtime to integrate the two companies’ operating systems and satellite locations in the U.S. in order to streamline business and create one brand. The Harrison name will eventually disappear, as Boston Coach carries plenty of flagship clout.
One of the unique twists to this venture is the fact that the primary executives and managing partners running Boston Coach and Harrison Global day to day worked at Boston Coach before. Harrison Global CEO Russell Cooke served Boston Coach from 1986 to 2005, starting out as senior vice president of operations before leading the company as President and CEO from 1995 to 2005. Harrison Global COO Bill Gemmell worked as CFO from 1992 to 2001, a role that helped him gain expertise in every facet of the company’s operations.
Terms and structure of the sales transaction were not disclosed. But Cooke told LCT that the acquiring company, Marcou Transportation Group, owner of Harrison Global and taxi and school transportation divisions, is about equal to Boston Coach in size and scope. “This was not a minnow swallowing the whale. It was manageable from a financial standpoint, with company revenues within 10% of each other.”
Boston Coach comes with a distinguished legacy, as it sprung directly from the Fidelity Investments firm, headed by Edward “Ned” C. Johnson III. Johnson created Boston Coach in 1986 as a high-end corporate transportation service for the members of his firm. At the time, there were few sedans and limousines serving the corporate market. Over the years it grew to include many firms and corporate clients that matched the brand presence and characteristics of Fidelity.
To this day, Boston Coach is one of the most highly sought after sources of affiliated chauffeured business among limousine operators nationwide. Its awards program for affiliates confers prestige on winners while its annual affiliate meeting in Boston each July, where the awards are presented, brings together an exclusive club of high-quality chauffeured transportation companies. In many respects, to be named an affiliate of Boston Coach is to have “arrived” in the limousine industry.
“This was Ned Johnson’s baby forever,” Cooke says. “What intrigued me about Fidelity are its integrity, capital, bandwidth, and Ned’s commitment to business.”
After Cooke left Boston Coach in 2005, he followed a golden rule of networking and advancement: He made himself available as a consultant and stayed in touch with the executives. “I [expressed] to Johnson that if ever at a point in time he wanted to launch off Boston Coach, I would be very interested,” Cooke says. “I kept probing and asking questions and never let go, with great passion and perseverance.”
Eventually, Johnson decided that Fidelity should focus more on its core investments and services and shed those properties that did not fit that strategy, including Worth Magazine and Wentworth Galleries, Cooke says. Cooke and Harrison Global were a knowledgeable and natural fit to take over Boston Coach. “They made the decision they wanted to find the right team to carry the legacy and commit to keep it.”
PLATFORM TO GROW
As their strategy going forward, Cooke will focus on boosting sales and revenues while Gemmell will pursue technology and operating initiatives. Both have extensive P&L experience in multiple limousine industry companies. They want to make Boston Coach the leading chauffeured luxury provider in the industry.
Boston Coach started with $1 million in annual revenues in 1986 and grew to $16 million in 1992 and $175 million by the early 2000s. It now projects annual revenues of about $200 million.
Like many limousine companies, Boston Coach suffered after the terrorist attacks of Sept. 11, 2001 and the ensuring recession. Boston Coach recovered, but then, like other companies, took substantial hits to revenues and its fleet all over again from the financial meltdown of 2008 and Great Recession. Boston Coach reported a fleet of 671 vehicles in the August 2008 LCT 100 Largest Fleets List, just one month before the financial meltdown. The combined companies most recently reported 405 chauffeured vehicles on the 2013 LCT fleets list
“We can apply experience from the first time around and learn from mistakes,” Gemmell says. “We are optimistic about this opportunity to build a legacy.”
The timing of the sale was right, given that the economy has not fully recovered, he adds. “We are highly confident about our ability to grow an executive service. We have a ton of work in front of us, but it doesn’t feel like work. We enjoy doing what we do.”