Levallois-Perret, France-based global third-party logistics (3PL) and freight transportation services provider GEODIS recently announced it has acquired Miami-based drayage services provider Southern Companies.
A purchase price for the transaction was not disclosed. Southern Companies provides various import and export services, including warehousing and trucking, to ensure customer goods are moving swiftly through the supply chain.
Established in 1965, family-owned Southern Companies has moved more than 1 million containers since the company’s inception. It has operating terminals in seven U.S.-based ports, including: Port of Miami, Port of Everglades, Port of Houston, Port of Jacksonville, Port of Tampa, Port of Savannah and Port of Charleston. Southern Companies provides a range of import and export services, including warehousing and trucking, to ensure customer goods are moving swiftly through the supply chain.
In an interview, Mike Honious, President & CEO, GEODIS in Americas, explained that as part of the company’s Ambition 2027 strategic plan, it sees acquisitions like with Southern Companies as an important way to expand its offerings in a consolidating market.
“In particular, this acquisition allows us to continue to build out our end-to-end supply chain network in the U.S. to best support our clients,” he said.
What’s more, he said its previous U.S. acquisition of Keasbey, N.J-based last-mile and omnichannel provider Need It Now Delivers, to enhance its end-to-end freight network in October 2022, pairs well with the acquisition of Southern Companies, as they have a longstanding business relationship, which served as a driver for this acquisition.
“We took our time in the due diligence process to ensure our capabilities and networks aligned and that it would be a strategic, long-term advantage,” he said. “When we took a look into Southern Companies’ drayage business along with current market trends of volumes at the U.S. ports, this acquisition made a lot of sense for us. With the way the market is trending, volumes are shifting from the West Coast to the East and Southern Coasts. We expect these key locations to continue to be high growth in the future, and this aligns with Southern Companies’ presence in seven key ports across the South that are critical to our clients: Port of Miami, Port of Everglades, Port of Houston, Port of Jacksonville, Port of Tampa, Port of Savannah and Port of Charleston. Paired with Need It Now Delivers’ strong presence in the New Jersey, New York and Los Angeles ports, we feel we are well-positioned with future market projections. Additionally, Southern Companies operates out of the Port of Miami and is also headquartered there, which is a major hub for importing and exporting freight to Latin American countries where we also do significant business. That made a lot of sense for us strategically as well.”
The Need It Now Delivers acquisition enhanced GEODIS’ deconsolidation and consolidation capabilities along with final mile, said Honious. But what it also needed, he said, were owned drayage capabilities to transport from the ports to the centers (vs. outsourcing).
“After establishing cross-selling opportunities between GEODIS and Need It Now Delivers, we saw the advantages that Southern Companies could provide by enhancing the drayage component to grow our overall transportation capabilities in the U.S.” he said.
In terms of the main benefits of this acquisition for GEODIS’ shipper customers, Honious said that GEODIS sees a huge advantage in combining its organizations, as GEODIS and Southern Companies customers will have full access to an end-to-end logistics offer, both domestically in the U.S. and internationally.
“GEODIS customers will have access to expanded drayage offerings while Southern Companies customers will have access to GEODIS’ international freight forwarding network and contract logistics services,” he said. “The acquisition of Southern Companies provides GEODIS with an opportunity to continue building a global, multi-modal and integrated freight network to offer customers leading end-to-end transport and distribution services. With the acquisition, both GEODIS and Southern Companies have a deeper and stronger operation behind them that will ultimately only elevate what we are able to offer customers together.
As for what this deal provides that was needed or missing, he said that with the Need It Now Delivers acquisition last year, GEODIS gained a significant port presence in New York, New Jersey and Los Angeles.
“However, we were looking to bolster our presence in the U.S. ports across the South, Southeast and Southwest given market trends—and these are all areas where Southern Companies has a significant presence,” he said. “In the past, we outsourced drayage services in the areas where Southern has operations. With both the Need It Now Delivers and Southern Companies acquisitions, we now have port coverage in the East, South and Southwest, which complements where the majority of freight is moving in the U.S. today. Another key point is that GEODIS already has freight forwarding and warehousing locations in the areas where Southern Companies operates. That was important for us because it allows us to continue to strategically build super-hub networks in these critical locations in the U.S., which provides customers with an efficient and reliable end-to-end logistics solution and unlocks synergy opportunities with our complementary services. Additionally, Southern Companies’ client portfolio is extremely diverse and spans verticals from fast-moving consumer goods to retail to industrial. Those verticals align with GEODIS’ current network and areas of expertise.”