In main acquisition, Knight-Swift purchases U.S. Xpress for $808 million

Knight-Swift Transportation Holdings Inc. as we speak introduced it is going to purchase U.S. Xpress for about $808 million in one of many largest trucking trade acquisitions lately.

The deal is anticipated to shut late within the second quarter or early third quarter, topic to customary closing circumstances, in accordance with a press release from the 2 firms.

“The chance to enhance earnings, acquire clients and attain extra skilled drivers, was very compelling to us,” mentioned Knight-Swift CEO Dave Jackson. “We anticipate to use the identical playbook that proved profitable within the Knight-Swift merger as we share finest practices, enhance operations and work collectively to assist U.S. Xpress develop into the most effective that it may be.

“Though it is going to take time, notably given the present freight surroundings, we’d not have pursued the transaction except we had been assured in reaching our return thresholds inside just a few years. Past that, we’ll proceed to work with the U.S Xpress group in pursuit of the efficiency ranges of our different truckload companies over the following a number of years, so the chance for our stockholders is substantial. Furthermore, this transaction won’t decelerate the geographic enlargement of our LTL community or our different progress initiatives, as our monetary and different assets stay vital.”

After the closing of the transaction, U.S. Xpress will proceed as a separate model and operation to attenuate disruptions for the driving associates, store and workplace workers, and clients. On the identical time, cross-functional groups made up of leaders from Knight, Swift, and U.S. Xpress will work collectively to leverage economies of scale, freight community efficiencies, and finest practices, in accordance with as we speak’s assertion.

U.S. Xpress is predicated in Chattanooga, Tennessee and generated roughly $2.2 billion in complete working income in 2022 whereas serving clients by means of a community of about 14 terminals and 30 drop yards, primarily situated throughout the japanese U.S. U.S. Xpress’ fleet contains about 7,200 tractors and 14,400 trailers, together with tractors supplied by some 1,000 impartial contractors. The corporate’s workforce contains about 7,900 drivers (together with impartial contractors), 300 upkeep technicians, and a pair of,200 non-driver workers.

U.S. Xpress CEO Eric Fuller, mentioned: “We’re very happy to ship to our stockholders the chance for near-term liquidity at a big premium. Moreover, becoming a member of the Knight-Swift group is an thrilling alternative for our folks, our clients, and the Chattanooga and different communities we name residence. The elevated scale, working experience and assets of the mixed entity will enable U.S. Xpress to pursue new ranges of service and effectivity. We’re delighted that U.S. Xpress will proceed to function as an impartial model and can accomplish that with the help and partnership of certainly one of North America’s strongest transportation firms.”

U.S. Xpress shareholders will obtain $6.15 in money for every share they personal, which is 310% above Monday’s shut of $1.50, in accordance with MarketWatch.

At closing, members of the Fuller household together with Eric Peterson, CFO, will transition out of their govt officer roles whereas remaining obtainable to make sure a clean transition. Tim Harrington and Josh Smith, each executives at Swift and members of the groups that helped obtain vital margin enchancment following the Knight-Swift merger, will be a part of U.S. Xpress as President and CFO, respectively. 

“The Fuller household, together with their co-founders, the Quinns, constructed one of many largest and quickest rising truckload carriers within the nation, which is a big accomplishment in such a fiercely aggressive trade,” mentioned Jackson. “We’re honored to guide the following part of U.S. Xpress’ growth, and we’re happy that the Fullers are keen to hyperlink a portion of their financial end result to ours to mitigate the transition danger and might be aligned with us in making certain that U.S. Xpress turns into the most effective it may be.”