Heartland Acquires Millis Transfer for $150 Million

A Heartland Express truck outside its headquarters
Heartland Express

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Heartland Express Inc. has acquired dry van truckload carrier Millis Transfer Inc. and related entities for about $150 million, citing the quality of the company’s drivers and its safety profile, among other factors.

It will fund the purchase and pay off the assumed debt with existing cash — except for about $750,000 in Heartland stock, according to the North Liberty, Iowa-based company.

The current Millis family management team, which has more than 113 years of combined experience, will remain with the business in its current role as the carrier retains its name. For the 12 months ended June 30, privately held Millis generated about $152 million in revenue, and the operations were profitable.



“The regional coverage, equipment, conservative and disciplined management style, and culture are all very compatible with our approach,” Heartland Chairman and CEO Michael Gerdin said in a company release.

Heartland ranks No. 57 on the Transport Topics Top 100 list of the largest for-hire carriers in North America.

After the transaction, Heartland reported it expects to end 2019 with $50 million to $60 million in cash, zero debt, and about $90 million available under its revolving line of credit.

One analyst was encouraged to see Heartland put its growing cash balance to work.

“However, we believe investors will be apprehensive about the transaction given what some perceive to be less-than-expected results from the company’s acquisitions of Gordon and Interstate,” Stephens analyst Jack Atkins wrote in a note. “Our sense is that this should be a much different transaction with minimal revenue churn, with Millis retaining its name and current management team.”

Heartland purchased Interstate Distributor Co. from owner Saltchuk Resources Inc. in 2017 for $113 million. Gordon Trucking, a truckload carrier in Pacific, Wash., was purchased in 2013 for $300 million.

Atkins also wrote he expected Heartland to focus on driving cost benefits due to advantages of scale and, possibly, some back-office savings after its latest transaction.

Gerdin added: “With an average fleet age, including the Millis fleet, of approximately 2 years for tractors and approximately 4 years for trailers, our capital expenditure requirements for the next several quarters are modest, absent opportunistic purchases.”

Meanwhile, for the past 12 months, Millis’ driver turnover has been less than 50%, which is superior to industry norms.


American Trucking Associations reported the turnover rate in the first quarter at large truckload carriers — those with annual revenue of more than $30 million — was 83%, 6 percentage points lower than 2018’s average rate of 89% and 11 points below a year earlier.

Millis, headquartered in Black River Falls, Wis., has terminals in Georgia, New York, North Carolina, Ohio, Texas, Virginia, Illinois and Wisconsin. Its primary areas of operations are the Midwest, eastern United States and Texas.

Millis serves a diversified customer base, and after the transaction Heartland’s consolidated customer list will be about 500, with no single customer greater than 8% of revenue. 

The company also operates Millis Training Institute, with five driver training locations. MTI was established in 1989 and over the past 30 years has graduated thousands of professional truck drivers from locations in Ohio, Georgia, Wisconsin, Texas and North Carolina.

Heartland is an irregular-route truckload carrier that focuses on medium- to shorthaul regional freight, serving customers with shipping lanes throughout the United States.