Echo Global Logistics acquires Open Mile Inc.
March 21, 2013
Echo Global Logistics, a Chicago-area non-asset based freight brokerage and a provider of technology-enabled transportation and supply chain management services, said this week it has acquired Boston, Mass.-based truckload brokerage Open Mile Inc.
Financial terms of the deal were not disclosed. This marks Echo’s 16th transaction since 2007, and it is its second one involving a New England-based company in the last year. In June 2012, it acquired Purple Plum Logistics LLC, a Wakefield, Mass.-based temperature-controlled truckload transportation brokerage.
“Open Mile has developed leading edge, cloud-based technology that successfully automates many of the manual tasks of transportation management,” said Douglas R. Waggoner, Chief Executive Officer of Echo Global Logistics. “The acquisition of Open Mile enhances the technology solutions we offer clients and carriers while also expanding our client base, sales force and carrier network in the Northeastern United States.”
Established in 2010, Open Mile is a non-asset based transportation service provider, focusing on truckload brokerage, that provides high-tech automation with freight management expertise, according to Echo officials.
In an interview with LM, Echo CFO Dave Menzel said Open Mile had been on Echo’s radar for a while in recent years as it was raising venture capital money in the Boston area and making investments into truckload-based technology.
“We became aware of the fact that they were looking for a strategic alternative a few months ago so we took a deeper dive and liked what we saw and completed the acquisition,” said Menzel.
Open Mile’s carrier-related truckload technology was of significant interest to Echo, explained Menzel. This technology includes advanced truck tracking via a cellphone system that allows a broker to know where a truck is at any given time, which he said will be of significant value to Echo customers.
And he also cited Open Mile’s technology, which helps it to automate how it works with truckload carriers, which will help Echo provide additional value to its 24,000-plus truckload carrier network through more automation and increased ease of doing business.
Menzel declined to disclose how many truckload carriers are in Open Mile’s carrier network. But he did say that its carrier base is almost exclusively focused in the Northeast.
“It is a niche they have in terms of handling freight within the Northeast corridors and building relationships that support that,” said Menzel. “It is more geographic in nature.”
Open Mile has 27 employees, according to Menzel.
With a detailed acquisition history in recent years, Menzel said Echo has been focused on organic growth, with acquisition targets tending to be smaller in size, while integrating them onto the Echo platform and subsequently growing in their own right post-acquisition.
Echo reported Non-GAAP net income of $3.5 million and Non-GAAP fully diluted EPS of $0.15 per share in the fourth quarter of 2012 and total revenue was $211.2 million, an increase of 29.7% from the fourth quarter of 2011.
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