Subscribe to our free, weekly email newsletter!


Vitran completes acquisition of Milan’s LTL operations

By Jeff Berman, Group News Editor
February 22, 2011

Editor’s note: This story has been updated with additional information.

Freight transportation and logistics services provider Vitran Corporation Inc. said it has officially closed its purchase of the assets of Milan Express’ less-than-truckload (LTL) division.

Financial terms of the deal, which was initially announced on January 14, were not disclosed. But Vitran officials said thatfFor the year ended December 31, 2010, Milan had revenues of $70.0 million through its 11 state region, and Vitran purchased all the rolling stock and other equipment of Milan. Vitran expects an accretive impact on its FY 2011 diluted earnings as a result of the acquisition, according to the officials.
Milan provides regional LTL services in the central and southern regions of the United States. By bringing Milan into the fold, Vitran gains 16 terminals in new markets, including Alabama, Georgia, Mississippi, North Carolina, and South Carolina.

Vitran officials said that the company will also operate two additional facilities to expand its pre-existing footprint in Chattanooga and Jackson Tennessee.

“We are extremely pleased to welcome both Milan’s employees and customers to the Vitran family,” said Vitran President and Chief Executive Officer Rick Gaetz in a statement. “We are delighted to introduce the states of Alabama, Georgia, Mississippi, North Carolina and South Carolina as new territory within Vitran’s North American LTL freight network. This important acquisition expands our reach as we continue to press forward with our goal of complete LTL coverage throughout both Canada and the United States. As with our other acquisitions, we will begin systematically cross-selling our premium regional, inter-regional and cross-border services to our combined customers in the near future. We look forward to maintaining the Ross family commitment to the region.”

And in an interview with LM, Gaetz said that this deal represents Vitran’s sixth LTL acquisition in the United States, adding that Vitran’s strategy is to build out a North American—U.S. and Canada—LTL infrastructure.

This effort, he explained, will be done by providing complete coverage in Canada and continuing to expand the company’s U.S. footprint.

“The attraction that Milan brought us was five additional states in the southern region of the U.S.,” said Gaetz. “In the overlapping markets, it improves our density and gives us five additional states to leverage our new customers and legacy customers into and out of.”

With the LTL sector particularly active in the southern U.S., coupled with stiff competition from several industry players, Gaetz said that Vitran has an opportunity to offer more geographic coverage to shippers every time its trucks back up to their dock doors. What’s more, he noted that Vitran has had success leveraging its customers in the past, and he expects that if Vitran meets or exceeds their expectations then it will have an opportunity to go deeper into their supply chains.

BB&T Capital Markets Managing Director Thom Albrecht wrote in a research note that acquiring Milan’s LTL business should Vitran’s density in the Central states, while existing customers might give more business to Vitran given their enhanced geographical coverage. 

For more articles on LTL news, please click here.

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

You’ve heard the old saying, it was the best of times, it was the worst of times. Rob Handfield sees this as the best of times for procurement professionals, who have an opportunity to deliver real value to their organizations

While core metrics were down from a very impressive July, the August edition of the Non-Manufacturing Report on Business from the Institute of Supply Management (ISM) was still very strong.

The Clean Cargo Working Group (CCWG) has released a report indicating that in 2014 average CO2 emissions in the global container shipping trades declined 8.4 percent from the year before.

UPS Freight, the less-than-truckload (LTL) subsidiary of UPS, recently announced it has rolled out a new service center facility in Franklin Park, Illinois. This is the company’s fifth Chicago-area service center along with other ones in Aurora, Chicago, Palantine, and South Holland.

Putting the renewed strength in the truckload market into a very positive perspective is a report issued by Avondale Partners analyst Donald Broughton, which was released yesterday. Entitled, “Q2’15 Trucking Capacity; Goldilocks Era Continues,” Broughton explained that in the second quarter only 70 truckload fleets failed, or exited the business. That number may seem high to some, but it is not, especially when you consider that the second quarter of 2014 saw more than five times as many truckload carriers, 375 to be exact, exit the business.

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