Roadrunner Transportation Systems Inc. said it has received a $540 million cash infusion from a private equity group that owns 8.6% of the shares in an announcement that also included a change in the senior leadership of the recently troubled trucking company.
The company said that about $240 million of the new preferred stock investment as a bridge loan until an asset-based loan can be secured with new commercial lenders. The remaining $300 million investment will be used as working capital and is structured in four series, payable in either six or eight years.
Roadrunner also promoted Curt Stoelting to CEO, replacing Mark DiBlasi, whom will serve on an interim basis as vice chairman at the board of directors. Mike Gettle takes over Stoelting’s old job as chief operating officer. Scott Cousins was also appointed as chief information officer and Bob Milane as general counsel.
“I am excited about the opportunity to continue to work with Mike, Scott, Bob and the rest of our talented management team and team members at Roadrunner,” Stoelting said. “Now that we have stable long-term financing in place, we can focus our efforts on improving our operations and pursuing new opportunities which will better allow us to serve our customers, partner with our key vendors and drive long-term value for our shareholders.”
Roadrunner also said it is close to hiring a new chief financial officer. Former CFO Peter Armbruster resigned shortly after an accounting error was revealed earlier this year that will require the carrier to refile earnings reports from 2014 through 2016.
In January, the company revealed an accounting error concerning unrecognized expenses from two acquisitions from 2011 — Morgan Southern and Bruenger — among the first of more than 20 acquisitions in the following 3½ years. Stoelting said the impact would likely be between $20 million and $25 million on the operating income. The company also announced it would record an additional goodwill impairment charge between $175 million and $200 million.
Roadrunner, which ranks No. 16 on the Transport Topics Top 100 list of the largest U.S. and Canadian for-hire carriers, hasn’t reported earnings for the last three months of 2016 or first three months of this year, but the company said it is in the final stages of preparing to issue all the reports from 2014 to the present.