3PL News: Genco, ATC deal is made official
Genco officials said that the new entity will be privately owned and rebranded under the name GENCO ATC
Latest NewsAugust U.S. waterborne shipments meet expectations, reports Panjiva FTR’s Trucking Conditions Index sees increase from June to July Apex Tool Group donates tools, use of warehouse to Harvey, Irma relief LM survey highlights the impact and importance of emergency preparedness following recent hurricanes eBook: Why Multi-Tier Supplier Collaboration is More Important Now More News
Latest ResourceeBook: Why Multi-Tier Supplier Collaboration is More Important Now Explore the benefits of supplier collaboration including sharing demand forecasts, faster reactions to demand or capacity changes and well-coordinated product launches.
Following a July announcement stating that ATC Corporation, a provider of logistics and remanufacturing services for the high-tech and automotive services had entered into a definitive agreement to be acquired by third-party logistics (3PL) services provider Genco Distribution System for $512.6 million, the deal has now been made official.
Genco officials said that the new entity will be privately owned and rebranded under the name GENCO ATC, with ATC Logistics & Electronics and ATC Drivetrain becoming new divisions within GENCO ATC. They added that the company will have an estimated revenue of $1.5 billion, roughly 10,000 employees and grow to 120 operations, as well as bringing locations in Fort Worth and Carrolton, Texas, Oklahoma City, Oklahoma, Memphis, Tennessee, and Matamoros into the fold.
Prior to this deal, Genco was a privately-owned, 6,800-employee company with more than 130 operations throughout the U.S. and Canada. It has been led by Chairman and CEO Herb Shear since 1971 and provides various services, including: contract logistics, reverse logistics, product liquidation, pharmaceutical logistics, and government solutions for more than 150 customers, including manufacturers, retailers, and U.S. government agencies.
During a conference call with financial analysts in July, ATC President and CEO Todd R. Peters said this merger will provide ATC’s current customers with a broader set of solutions and the same level of operational expertise for which ATC has become known.
“We feel this agreement is a great opportunity for us, our customers, our employees, and our stockholders,” he said. “And in addition, this merger provides an opportunity for all our people to join a top-notch logistics company. [This] is a tribute to our employees’ hard work and dedication that Genco sees ATC as an attractive potential acquisition.”
According to a statement issued by GENCO ATC this week, this merger immediately positions GENCO ATC as the clear supply chain management leader in the consumer electronics/information technology market. The statement added that solution enhancements will be realized in transportation management; test and repair; remanufacturing; high velocity serialized fulfillment, co-packing, kitting; warehouse management systems; and product remarketing. And it also said that these complimentary integrated solutions along with advanced technology and a focus on continuous productivity improvement will offer customers a significant opportunity to lower their overall supply chain costs.
“The formation of GENCO ATC is an exciting chapter in the evolution of our two well-known respective companies,” said Herb Shear, chairman, president, and CEO of GENCO ATC, in a video message to customers on the company’s Web site. “We are uniting the strengths, competencies, expertise, and industry-leading services of two world-class companies around the single vision and common purpose: the customer.”
Shear added that with this merger, GENCO ATC has increased the breadth and depth of its service offerings and ability to diversify into the fast-growing wireless, consumer electronics/information technology, and vehicle service parts markets.
A noted 3PL expert told LM that this deal will have myriad benefits for the new company.
“Genco’s acquisition of ATC helps it further its leadership position in domestic reverse logistics,” said Evan Armstrong, president of supply chain consultancy Armstrong & Associates. “ATC’s 3PL ATC Logistics & Electronics has built a very profitable high-tech vertical industry-focused 3PL operation with significant high-volume order fulfillment, returns processing and test and repair capabilities. With Genco’s recent account expansion with Dell Computer, we see this acquisition as a great compliment to Genco’s traditional retail centric operations and a further footprint build out to support high-tech customers such as Dell. ATC Logistics & Electronics has a long-term relationship with AT&T DSL & Mobility, and has significant operations for Nokia, TiVo, T-Mobile, and TomTom.”
In a separate announcement Greenbriar Equity Group, a $1.5 billion private equity group focused on the global transportation industry, said its Greenbriar Equity Fund II, L.P. and affiliated investment entities have made an investment into GENCO ATC.
Greenbriar Managing Director Jill Raker said in a statement that Genco and ATC form a formidable competitor in logistics as their combined capabilities in reverse solutions, repair, technology, process engineering and liquidation will create additional opportunities with existing and new customers across their end markets.
About the AuthorJeff Berman, Group News Editor Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. Contact Jeff Berman
Subscribe to Logistics Management Magazine!Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your entire logistics operation.
Start your FREE subscription today!
Improving 3PL Management: Glanbia Adds Muscle to Logistics Why Retail Supply Chain Transformations Fail - and how to get it right View More From this Issue