3PL/M&A news: NFI acquires IPD, expands Canadian footprint
June 24, 2010
Cherry Hill, New Jersey-based NFI, an asset-based third-party logistics (3PL) services provider, announced this week it has acquired IPD, a global transportation and logistics services provider based in Mississauga, Canada.
Financial terms of the acquisition were not disclosed.
In an interview at this week’s eyefortransport 3PL Summit in Atlanta, NFI CEO Sid Brown provided LM with an overview of the various factors that led to this acquisition.
“We have a small footprint in Canada, and we had secured some pretty nice sized contracts that were getting us to a larger footprint [there] from a warehousing standpoint,” said Brown. “We felt we needed to add to our capabilities from a transport standpoint so this was a good entry point for us in terms of being able to have the capabilities to handle shipments in and out of Canada and within Canada in a much broader capacity than we had previously.”
IPD’s core focus is in perishable-based air and ocean transport, intermodal, and truck brokerage services. It has a large presence in the handling of produce in and out of Canada for s few of the largest grocery chains doing business in the country, with shipments moving into and out of Canada by IPD to South America, Europe, the United States, and Mexico.
Brown explained that perishable transport requires a complex way of moving shipments, which requires a lot of detail. And with IPD providing large grocery chains with an end-to-end solution, Brown said NFI hopes to leverage some of IPD’s strengths which may be applicable for NFI’s U.S.-based grocery partners. Roughly 20-to-25 percent of NFI’s customers are in the grocery industry.
“This gives us a larger footprint into Canada and we hope to build upon that,” said Brown. “They are a non-asset provider, and we hope to maybe put some assets up there as well with some dedicated fleet operations that might complement some of the things their customers are doing—so it is a broadening of services in Canada and hopefully taking some of what they do and bring it here to the U.S.”
Another benefit of this deal cited by Brown is that IPD is a wholesaler of Class I railroad CN and has a strong relationship with the carrier, which will be a boon to NFI’s Intermodal group.
“IPD’s non-asset based transport services, specializing in inbound and cross-border routes, offers a perfect complement to NFI, with its strengths in outbound transport and dedicated fleets, and its widespread distribution and warehousing network,” said IPD President Rob Rusnov in a statement. “Our logistics and transportation brokerage services will further enhance NFI’s already wide range of offerings. Now all of our clients and potential clients on both sides of the border will have access to our combined expertise.”
IPD was represented in this deal by Atlanta-based EVE Partners LLC, a transportation and logistics M&A firm. EVE Managing Partner Tom Connolly noted that this deal presents a powerful combination that will enhance the competitive position of NFI and IPD in the marketplace.
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