MT. KISKO, N.Y. - Craig Lentzsch, former president and CEO of Greyhound Lines, reportedly has been hired as chief executive of the newly-formed company that is purchasing the Coach USA operations in nine western and south central states.
Industry sources say a formal statement regarding Lentzsch's hiring likely will be made within a matter of days, certainly weeks.
The new company being headed by Lentzsch will be the largest tour and charter bus operation in North America, with a fleet of more than 1,550 coaches and annual revenues of more than $215 million.
The 54-year-old Lentzsch, a veteran of 25 years in the coach industry, officially left Greyhound on July 1. Six days earlier, Greyhound's parent company, Laidlaw International of Naperville, Ill., announced it was replacing Lentzsch with Stephen E. Gorman, a former senior executive with Krispy Kreme Doughnuts.
Lentzsch spent nine turbulent years at Greyhound, battling to keep the company growing, profitable and, oftentimes, competitive with Coach USA.

New company, challenges
In his new job, Lentzsch will head a brand new company that will manage the operations of at least two-dozen, mostly-charter-bus companies that comprise the western and south central regions of Coach USA.
A Mt. Kisko-based investment firm, Kohlberg & Co., formed the company, called KBUS Holdings LLC, to buy the Coach USA operations in California, Colorado, Nevada, Arizona, Wyoming, Texas, Tennessee, Arkansas and Louisiana. Kohlberg is one of the foremost acquisition and recapitalization companies in the U.S.
KBUS Holdings will have two divisions, CUSA LLC, which will operate the former Coach USA companies, and a leasing company that will own all of the buses operated by CUSA. Lentzsch likely will head KBUS and the two divisions.
The West region of CUSA will operate at least 1,150 vehicles and employ 2,200 people, while the South Central region will run roughly 400 vehicles and employ more than 800 people.
Those two regions produced total revenues of $215.9 million during the year ended April 30, and had an operating profit, before goodwill amortization, of $14.6 million, or an operating margin of more than 6.5 percent. Net earnings are not available.
By comparison, Greyhound has 12,000 employees, operates nearly 2,400 buses, and has annual revenues of more than $1 billion.

The right choice?
One veteran West Coast bus executive said the choice of Lentzsch to run the sprawling former Coach USA regions is a smart decision. "With Craig Lentzsch you have someone who understands the charter business, line haul and contract services. . . . He also understands how charter bus revenues on the West Coast can fluctuate."
That last factor is important, said this executive. Senior executives of Stagecoach Group PLC, the parent company of Coach USA, never could quite come to gripes with the wide revenue swings of charter bus services, according to this executive.
Lentzsch also has a reputation for surrounding himself "with very good people, very strong people."
Coach USA has a number of seasoned managers at many of its West Coast operations, lead by Western Region Vice President John Busskohl, an energetic executive who was born into the coach business. His father, Charles Busskohl, founded Arrow Stage Lines of Phoenix, one of the original companies that formed Coach USA.

Talk borne out
Prior to joining Greyhound, Lentzsch was chief financial officer of Motor Coach Industries, which was once owned by Greyhound. He also co-founded a company called BusLease, which owned and leased coaches to charter and tour companies and Greyhound. BusLease was merged with Greyhound in 1987, and eventually became MCI Financial Services, which specializes in coach financing.
The minute Lentzsch walked out the door at Greyhound, there was wide spread industry speculation he would be the leading candidate to manage the companies being acquired by Kohlberg. For once, an industry rumor appears to have been borne out.
Before Lentzsch can take over management of KBUS/CUSA, the sale must be completed and the transfer must be blessed by the U.S. Department of Transportation Surface Transportation Board. The board already has given preliminarily approval to the deal pending the filing of comments opposing the plan. Opposing comments could trigger formal procedures and more critical consideration of the deal by the Surface Transportation Board.
When Stagecoach Group announced it was selling the West and South Central regions of Coach USA, it said the deal involved 18 "businesses." However, in its application seeking approval of the transfer, Kohlberg revealed that at least 24 Coach USA units were involved. Stagecoach has yet to explain the discrepancy between the 18 businesses and the 24+ companies listed on the Surface Transportation Board application of Kohlberg.
Kohlberg & Co. declined comment for this article and efforts to reach Lentzsch were unsuccessful.