The SeaLink Travel Group Ltd (ASX: SLK) share price is pushing higher on Tuesday after the release of a positive update.
At the time of writing the travel company's shares are up 1% to $3.88.
What did SeaLink announce?
This morning SeaLink announced that its wholly owned subsidiary Transit Systems has been awarded four passenger transport service contracts with the Minister for Transport in South Australia.
It has retained areas currently serviced in the East West, Outer North East and North South regions, and is expanding services to a new contract region, the Outer North.
The North South region is an integrated bus and light rail contract which will be delivered through a joint venture with John Holland Group and CIMIC Group Ltd (ASX: CIM) subsidiary UGL.
What are the terms?
According to the release, the new bus and tram passenger transport service contracts commence in early July and are each for an eight-year period. The government retains an option to renew them for a further two years.
The estimated contract revenue is approximately $1.45 billion in total over the eight-year contract term.
These contracts mean that Transit Systems has grown its participation in the South Australian market and cemented its position as the largest private operator of public metropolitan bus services in Adelaide.
SeaLink's CEO, Clint Feuerherdt, believes the contracts represent its commitment to delivering world-class operations and reinforce its position as a global, multi-modal transport leader.
He said: "Safety, convenience, reliability and performance underpin all of our services and we are pleased to renew our three existing contracts with the South Australian Public Transport Authority, extending our 20-year operating history in Adelaide. "
"This announcement also reinforces our place as a competitive and leading international multi-modal provider, with the addition of tram operations, complementing our ferry and bus expertise. We remain passionately committed to designing, delivering and operating services that reflect the needs of the local community, combined with our extensive transport experience and innovations," he concluded.
