Student Transportation Completes Acquisition



    
                      Expansion to Southwestern Ontario
                Increases Canadian Revenues to Just Under 25%
    

    TORONTO, July 15 /CNW/ - Student Transportation of Canada ("STC"), an
operating subsidiary of Student Transportation of America ("STA") (TSX: STB),
today announced that it has signed and completed the previously announced
acquisition of Elgie Bus Lines Limited, a school bus operator based in London,
Ontario. The transaction was contingent upon meeting certain conditions and
receiving customer consents which have been obtained. Management expects the
deal to be accretive to shareholders of its common stock.
    "As we mentioned before, this is a great company and a great acquisition
for us as it adds to our regional density in Ontario and opens a new area of
expansion for us in the southwestern portion of the province. It also
increases our Canadian dollar revenues to just under 25% of our total and has
good contracts with fuel protection," said Denis J. Gallagher, chairman and
CEO of STC.
    "STA is one of the rare transportation company's on the TSX that actually
is doing very well. For our fiscal year ending June 30, 2008, revenue is up
year over year consistent with our growth history and strategy, operating cash
flows are up substantially and we anticipate seeing margin improvement over
the previous fiscal year. The strategy we have developed in our business model
has allowed us to continue to grow and create sustainable attractive
dividends," said Gallagher. The closing price of the common shares (TSX: STB)
on July 14, 2008 represented a yield of over 9.5%.
    Elgie is the company's eighth acquisition in Canada since its IPO,
increasing operations to more than 1,200 vehicles and nearly C$50 million in
annualized revenue. The Company utilized its availability under its senior
credit facility, recently created with the proceeds of the common share
private placement offerings completed in April 2008, to fund the acquisition.

    About Student Transportation

    Founded in 1997, Student Transportation is the fourth-largest provider of
school bus transportation services in North America, conducting operations
through local operating subsidiaries. Student Transportation has become a
leading school bus transportation company by aggregating operations through
the consolidation of existing providers and conversion of in-house operations
and operates more than 5,400 school vehicles in North America. For more
information, please visit www.rideSTA.com.

    Forward-Looking Statements

    This news release contains "forward-looking statements" within the
meaning of applicable securities laws, which reflects the expectations of
management regarding STA's results of operations, expense levels, cost of
capital, financial leverage, seasonality, cash flows, performance, liquidity,
borrowing availability, financial ratios, ability to execute the STA's growth
strategy and cash distributions. Forward-looking statements generally can be
identified by the use of forward-looking terminology such as "may", "will",
"expect", "intend", "track", "targeted", "estimate", "anticipate", "believe",
"should", "plans" or "continue" or similar expressions suggesting future
outcomes or events. These forward looking statements reflect STA's current
expectations regarding anticipated future events, results, circumstances,
performance or expectations, which are not historical facts. Forward looking
statements involve significant risks and uncertainties, and should not be read
as guarantees of future performance or results, and will not necessarily be
accurate indications of whether or not or the times at which or by the
performance or results will be achieved. A number of factors could cause our
actual results to differ materially from the results discussed, expressed or
implied in any forward-looking statement made by us or on our behalf,
including, but not limited to the factors discussed under "Risk Factors" in
our Annual Information Form. These forward looking statements are made as of
the date of this news release and, except as required by applicable law, we
undertake no obligation to publicly update or revise any forward-looking
statement, whether as a result of new information, future events or otherwise.





For further information:

For further information: MEDIA CONTACT: Lynette Viviani, (973) 968-7929
office, (973) 534-1004 mobile, lviviani@rideSTA.com; INVESTOR CONTACTS:
Student Transportation of America Ltd., Denis J. Gallagher, Chairman and Chief
Executive Officer, (732) 280-4200, (732) 280-4213 (FAX); Patrick J. Walker,
Executive Vice President and Chief Financial Officer, (732) 280-4200, (732)
280-4213 (FAX); Keith P. Engelbert, Director of Investor Relations, (732)
280-4200, (732) 280-4213 (FAX), Email: kengelbert@rideSTA.com, Website:
www.rideSTA.com

Organization Profile

STUDENT TRANSPORTATION INC.

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STUDENT TRANSPORTATION OF AMERICA ULC

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