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January 28, 2020 5:15 PM, EST

Chassis Provider FlexiVan to Merge With American Intermodal Management

I Squared Capital has acquired a majority stake in FlexiVan Leasing Inc. and said it would merge it with American Intermodal Management but will retain the FlexiVan name. (FlexiVan Leasing Inc.)

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I Squared Capital acquired a majority stake in FlexiVan Leasing Inc., the private equity firm announced Jan. 27. FlexiVan is one of the oldest names in the marine chassis industry.

As a result of the acquisition, I Squared Capital said it would merge FlexiVan with another company, Scottsdale, Ariz.-based American Intermodal Management, and the new combined operation will work to bring more technological improvements to the chassis industry.

With the merger, FlexiVan becomes the nation’s third-largest chassis provider behind Trac Intermodal and Direct ChassisLink. Trac operates an estimated 180,000 units, while Direct ChassisLink controls 153,000. AIM operates 12,500 chassis, and the combined fleet with FlexiVan will be 137,500.

Ronald Widdows, CEO of AIM

Widdows

“This transaction combines FlexiVan’s 65 years of operating history, nationwide presence and deep customer relationships with AIM’s fleet of new chassis, innovative technology and data analytics to offer our customers more flexibility and great supply chain efficiency,” Ronald Widdows, CEO of AIM, said in a statement sent to Transport Topics. He will serve as the CEO of the combined company.

The new business will retain the FlexiVan name, which dates to the mid-1950s when company officials worked with trucking executive Malcolm McLean to develop the first standardized intermodal shipping container.

Terms of the transaction were not released, but the deal could prove beneficial for both companies to operate under one brand.

American Intermodal Management chassis

The AIM chassis fleet is relatively new and has many of the technologies trucking companies have been seeking. (American Intermodal Management via Facebook)

FlexiVan will acquire the AIM chassis fleet, which is relatively new and has many of the technologies trucking companies have been seeking, including radial tires, LED brake lights and automatic braking systems. Since chassis can last from 15 to 25 years, at least for now, FlexiVan also will not have to buy thousands of new chassis from the industry’s most prominent manufacturer, China International Marine Containers, whose products are subject to tariffs.

The existing AIM chassis will now be welcomed at most ports, and that had not been the case until this announcement. Founded in 2016, AIM had been shut out of many terminals and ports, industry analysts say, because it did not have established relationships with the ocean carriers and the terminal operators, which controlled which chassis were used at those facilities.

Paul Bingham, director of transportation consulting with IHS Markit

Bingham

“AIM as an upstart, they didn’t have any of those legacy relationships or contracts, and they were being essentially left out of some business. That’s because their equipment wasn’t able to be used at some specific terminals,” said economist Paul Bingham, director of transportation consulting with IHS Markit. “This deal breaks down the walls, at least for AIM getting onto the terminals where the acquired company has operations now, so it expands where their fleet can reach, and the merged company will have more opportunities.”

However, FlexiVan does have working agreements with several large container shipping companies, including OOCL and Ocean Network Express, and it works with all of the major chassis pools.

FlexiVan logo

“The combination of AIM and FlexiVan will provide strong financial support to continue the upgrade of FlexiVan’s fleet, support significant investment in new assets and fund ongoing development of innovative IT systems, all of which will allow us to deliver an industry-leading customer experience,” FlexiVan President Charlie Wellins said in a statement.

For the past several years, beneficial cargo owners and trucking companies have raised concerns over the quality of chassis at ports across the country. They have complained the units still have outdated and unsafe radial tires, older-style lights and lack anti-lock brakes.

Bingham said he’s not sure, from a trucking industry perspective, if chassis customers will see a significant change overnight.

I Squared Capital logo

“I really don’t know if it is going to fundamentally revolutionize anything, because it’s still not moving the industry to where it’s the actual truckers owning the chassis like it is in the rest of the world,” he said. “The issues revolve, as they always, have around maintenance. Who is going to fix the tires and make sure they’re in a roadworthy condition, especially as the oversight has increased over the years on roadworthiness? This particular merger is a change of some of the leadership, but I’m not sure where it’s going to go in terms of management.”

I Squared Capital, based in Miami, focuses on infrastructure and transportation. FlexiVan is based in Kenilworth, N.J.

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