Subscribe to our free, weekly email newsletter!


RRTS acquires G.W. Palmer Logistics

By Jeff Berman, Group News Editor
September 12, 2013

Non asset-based third-party logistics services provider Roadrunner Transportation Systems (RRTS) said this week it has acquired all of the outstanding equity of Batesville, Arkansas-based G.W. Palmer Logistics LLC, a non-asset truckload service provider.

RRTS said the purchase price was roughly $2.5 million, plus an earn-out capped at $2.8 million, adding that the acquisition was financed with borrowings under Roadrunner’s credit facility. And it added that for calendar year 2012 G.W. Palmer generated roughly $20 million in revenues, with G.W. Palmer expected to be accretive to Roadrunner’s near term earnings.

“The G.W. Palmer acquisition enhances our truckload service offering in the South due to its concentration in temperature controlled products,” said Mark DiBlasi, President and CEO of Roadrunner, in a statement. “G.W. Palmer’s management team will remain in place and are excited about the growth opportunities we collectively envision. We look forward to supporting and expanding G.W. Palmer’s strong customer relationships and service record as we expand the business.”

RRTS continues to make acquisitions at a fervent rate, with this deal following recently announced acquisitions of Marisol International LLC, a non asset-based supply chain-critical, provider of international logistics services http://www.logisticsmgmt.com/article/rrts_acquires_marisol_international_expands_international_services”>in late July and the Southeast drayage division of Transport Corporation of America (TA Drayage), a provider of intermodal transportation and related services in the Southeast, in August.

DiBlasi recently told LM that RRTS intends to remain active on the acquisition front.

“We have a profile we use for [acquisitions],” he said. “Since January 2006, we have made a total of [26] acquisitions and look for companies that are well-run and well-managed profitable businesses and non-asset or light-asset in their business model. Even though we acquire some companies with assets at times, we do look for companies that provide capacity that are actual carriers and are going to give us additional reach…or compliment existing resources as we build out our portfolio of services and are immediately accretive. Integration is also key as we look for a very strong cultural fit between the management team we are acquiring and our management team. If that fit is not there, we will walk away from a deal; we have done that before.”

Stifel Nicolaus analyst David Ross recently wrote in a research note that this summer Roadrunner announced a public offer of 4.3mm shares of common stock, consisting of 1.5mm primary shares, and 2.8mm of secondary shares from selling stockholders, adding that it will also grant a 645,000 share over-allotment option (15% of the total issue) to come exclusively from current ownership.

And BB&T Capital Markets analyst Thom Albrecht commented in a research note that this move by RRTS is another classic tuck-in acquisition.

“Contrary to the view of some, RRTS is not making acquisitions on a helter-skelter
Basis,” Albrecht wrote. “During the past couple of years nearly all deals have been done to fortify existing niches such as TCS (temperature controlled services, intermodal and TMS. While the recent Marisol deal expanded RRTS into global freight forwarding, other deals strengthen core competencies.”

 

 

 

About the Author

Jeff Berman headshot
Jeff 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. .(JavaScript must be enabled to view this email address).


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!

Recent Entries

NRF's Jonathan Gold explains that the past year was replete with disruptions, slowdowns and partial shutdown, which can no longer be the norm, saying ports and dockworkers must adapt to ensure they provide shippers with the predictability and stability they need.

Last month, I gave a presentation to a group of senior transportation and supply chain executives. It was entitled “Predictable Surprises,” because it addressed how transportation and supply chain professionals can eliminate unpleasant surprises by looking at and evaluating issues in the transportation industry, and projecting how those issues will affect their companies.

The Port of Los Angeles (POLA) and the Port of Long Beach (POLB) said this week that they have formally established working groups, which they said will aim to seek new supply chain efficiencies, and focus on various aspects of port operations, including peak operations and terminal optimization in an effort to augment the San Pedro Bay port complex.

A month ago, the Shippers Conditions Index (SCI) from freight transportation consultancy FTR indicated that shippers might be traveling on a rocky road in the coming months. And one month later it appears those concerns appear to have been confirmed.

The American Association of Port Authorities (AAPA) had nothing but praise for the Senate passage over the past weekend of the Bipartisan Congressional Trade Priorities and Accountability Act of 2015 (TPA-2015).

Article Topics

News · 3PL · RRTS · All topics

Comments

Post a comment
Commenting is not available in this channel entry.


© Copyright 2015 Peerless Media LLC, a division of EH Publishing, Inc • 111 Speen Street, Ste 200, Framingham, MA 01701 USA