Fidelity selling limo firm launched by ‘Ned’ Johnson
Fidelity Investments is selling BostonCoach, a limousine and black-car service the firm’s iconic chairman, Edward “Ned” C. Johnson 3d, launched in 1985, the story goes, after waiting too long for a taxi at the airport.
The Boston-based mutual fund giant said it is selling the company to Harrison Global of Waltham, an owner of chauffeured limousines, car services, and taxis. Fidelity said Harrison intends to retain BostonCoach’s headquarters in Everett, as well as its drivers and other employees, numbering more than 560 nationally. BostonCoach employs about 275 people in Massachusetts.
Harrison executive Russ Cooke, a former president of BostonCoach, will become chief executive of the acquired business. “Harrison Global intends to retain the BostonCoach brand and continue to operate its services in the same fashion as they are run today,” Cooke said.
Terms of the deal were not disclosed. The sale comes as BostonCoach struggles with declining revenue and has cut half its work force nationally in a competitive business with thin margins.
The limo business reported $83 million in revenue in 2010, the last year it disclosed such figures. That was down sharply from the $147 million reported in 2006.
BostonCoach is part of Fidelity’s private equity group, Devonshire Investors, which invests in private firms. The limo company has long been a pet project of Johnson, 82, and he trained his characteristic attention to detail on the business.
Initially, the car service transported Fidelity employees but expanded over time to its current fleet of 200 vehicles in Boston and service in 40 countries. Today, BostonCoach has a blog and an iPhone application for booking rides.
Years ago, one BostonCoach driver described his embarrassment at picking up Johnson and not realizing there was a spill on the floor of the back seat of the car. The driver then watched as Johnson bent over, wiping up the mess himself.
Fidelity spokesman Vincent Loporchio noted that Fidelity has sold a number of its private businesses in the past, including its Community Newspapers group and Wentworth Gallery.
“We create and manage businesses over a range of different industries,’’ he said.
After reviewing strategic options for BostonCoach, he said, “we made the determination that this [sale] best positions [it] for future success.”
BostonCoach now employs fewer than half the people it did when the company’s current chief executive, Larry Moulter, was named to run the business in 2008.
Moulter, formerly the chief of the Boston Garden sports arena, has decided to leave Fidelity. Loporchio said: “He has done a tremendous job.”
The deal is expected to be completed in June.
Harrison is co-owned by two brothers, David and Derek Marcou. They have been acquiring a number of companies in recent years, including New England Coach Inc. of Canton, which was purchased at the end of December.
According to its website, Harrison Global has 150 vehicles and locations in New Hampshire, Raleigh-Durham in North Carolina, and the Washington, D.C., area.
David Marcou, chief executive of the Waltham company, was a member of the Waltham City Council for a decade before resigning in 2010, citing the pressures of his growing business making it difficult to attend city meetings.
Both Harrison Global and David Marcou have had a number of tax liens placed against them in recent years by government entities, according to public records.
Last month, the company resolved a lien placed against it by the Department of Unemployment Assistance over $23,359 in unpaid contributions to the state’s unemployment insurance trust, plus interest.
Marcou declined to comment on the tax matters.