XPO Logistics to acquire Pacer International
January 21, 2014-- Furniture Today,
Greenwich, Conn. - XPO Logistics, parent company of home delivery specialist 3PD, announced last week it has agreed to acquire Pacer International, a major provider of intermodal transportation services.
The deal, valued at about $335 million, is XPO's 11th acquisition in two years and will double the company's annual revenue "run rate" to $2 billion, officials said. Pacer had revenues of $1 billion for the 12 months ended Nov. 30.
"The transaction will make us the third largest North American provider of intermodal services, one of the fastest-growing areas of transportation logistics," said Bradley Jacobs, chairman and CEO of XPO.
"We'll also be the largest provider of intermodal services in the burgeoning cross-border Mexican market, where growth is being driven by a trend toward near-shoring manufacturing," he added.
Jacobs, who will remain as CEO of the combined companies, said the latest acquisition "will be significantly and immediately accretive to our earnings and accelerate growth companywide."
Intermodal transportation involves using more than one method of transportation for a single shipment. Typically, it means moving a container by rail and truck to its final destination.
Jacobs said the acquisition is consistent with XPO's strategy of building a premier supply chain offering by acquiring leading positions in the fastest-growing sectors of logistics.
3PD, the largest provider of heavy goods, last-mile logistics, was acquired in August. Last month, XPO acquired NLM, the leading provider of Web-based freight management services for companies specializing in expedited transportation. 3PD's customer base includes numerous furniture retailers and manufacturers.
The latest acquisition calls for shareholders of Pacer, whose stock is traded on the NASDAQ over-the-counter market, to receive $6 in cash and $3 in XPO stock for each share of Pacer stock.
XPO said Daniel Avarmovich, CEO of Pacer, and "substantially all of Pacer's executives" will remain with the company.
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