Knight-Swift’s acquisition of U.S. Xpress is made official

Following its March announcement in which Phoenix-based Knight-Swift Transportation, the largest player in the truckload market, with $4.5 billion in 2022 revenue, said it was acquiring Chattanooga, Tenn.-based U.S. Xpress, which ranked ninth in TL revenue last year at $2.2 billion, Knight-Swift said today that the transaction is now a done deal.

This announcement came on the heels of the approval of the acquisition by U.S. Xpress’ shareholders on June 29, and when the transaction is approved, U.S. Xpress was de-listed from the New York Stock Exchange.

As previously reported, the deal is valued at $808 million, including assumption of $484 million of debt.

“We are grateful for the efforts of so many who worked diligently to bring about such a significant transaction in the truckload industry,” said Knight-Swift CEO, Dave Jackson in a statement. “Against the current backdrop of a particularly difficult business environment, the chance to add one of the largest brands in our industry, with significant opportunity to improve earnings, gain customers and reach more professional drivers, is a compelling part of our plan to drive higher highs and higher lows across successive truckload freight cycles.

As we have engaged with more of the U.S. Xpress organization since the announcement, we have even more confidence that our combined efforts will lead to achievement of the profitability targets we communicated. Our cross-functional synergy teams made up of leaders from Knight, Swift, and U.S. Xpress are off to a great start collaborating on plans to share best practices, improve operations and leverage economies of scale—and now they have the green light to fully engage. While the truckload part of the organization focuses on achieving the goals we have laid out for U.S. Xpress, our LTL and M&A teams remain focused on our strategic priority of continuing to build out a nationwide LTL network.”

As previously reported, Knight-Swift said that this deal will boost Knight-Swift’s revenue base by nearly 30%. Knight-Swift management said it expects a “high-80s” adjusted operating ratio and mid-teens return on invested capital for U.S. Xpress by 2026.

And Knight-Swift said that U.S. Xpress brand and separate operations will continue under new ownership. Knight-Swift said its growth and diversification strategy remains “intact,” with low leverage and strong cash flows to support its ongoing national LTL build-out and full range of capital allocation alternatives.