Recent Acquisitions Bode Well for Trucking in 2021

Bison, Black Horse
Bison Transport (left) and Black Horse Carriers

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Several recent acquisitions are signaling a robust 2021 for trucking.

The freight transportation space saw strong activity in the second half of 2020. But there still were constraints on the market driven by the coronavirus pandemic. Those constraints slowly easing and new opportunities bode well for the year ahead.

“We will see a spike in deal announcements in the first two quarters of ’21 for multiple reasons,” Spencer Tenney, president of transportation merger and acquisition advisory firm Tenney Group, told Transport Topics. “Some large banks placed a moratorium on all acquisition financing during the second half of 2020 due to the uncertainty tied to COVID-19. Many deals that would have been announced last year were delayed, restructured and pushed into ’21.”

Tenney noted another consideration is that many business owners who would have begun their exiting process in the second quarter of last year paused to work through the pandemic. He noted that created a temporary shortage of available trucking companies to purchase.

“Now those business owners are beginning to exit the trucking industry,” Tenney said. “Consequently, the public will see 12 to 15 months of deal activity squeezed into a six- to nine-month period. The trend is more of market normalization than a spike.”

The industry has seen several notable acquisitions since the end of last year. Penske Logistics announced Dec. 31 that it acquired Black Horse Carriers. Bison Transport Inc. announced Jan. 5 that it was acquired by privately held James Richardson & Sons.

“We all feel great about this,” Bison President Rob Penner told TT. “For us, it was about being able to live up to our growth plan. In order to do that and seize on opportunities for any size business that makes sense for us, we were looking at a different capital structure.”

Penner expects there will be opportunities to grow through acquisitions over the next year. But he doesn’t want finances alone to cause the company to miss out on what might be a good fit. So having the business owned by a larger shareholder gives it more headroom.

“We know the M&A market is strong,” Penner said. “We know that there are some good businesses that are becoming available or will transact in the next year or two. Some good-size businesses. So for us, we don’t want to stand on the sidelines.”

Bison Transport ranks No. 56 on the Transport Topics Top 100 list of the largest for-hire carriers in North America.

The McCoy Group announced Dec. 30 the subsequent acquisition of liquid and dry bulk food grade hauling company W.W. Transport. Both family-owned companies have been reaching out to customers and operating partners about the deal to ensure a seamless transition.

The McCoy Group already is the parent company to six subsidiaries in the truck, transportation, construction and forestry industries. That includes transportation companies Foodliner and Quest Liner. Its portfolio also has truck dealerships Truck Country and Stoops Freightliner-Quality Trailer.

Foodliner/Questliner ranks No. 85 on the Transport Topics Top 100 list of the largest for-hire carriers in North America.

Trucking, warehousing and logistics provider Fraley and Schilling announced Jan. 5 that it acquired pneumatic dry bulk trucking company KBT Enterprises. Tenney Group was an adviser on the deal. KBT will operate as a subsidiary of the company.

“Our priority is to intentionally grow our company in a way that puts our people first,” F&S President Chris Seals said in a statement. “With this new acquisition, we will leverage our fleet advantages to build and grow the existing team at KBT.”

The transportation and logistics real estate market also is seeing a lot of acquisition activity. Derek Fish, vice president of acquisitions at real estate operator Realterm, said the momentum from last year’s strong finish will carry into 2021.

“I would say absolutely the end of 2020 and the beginning of 2021 have been extremely active,” Fish told TT. “In the past 12 months, we have deployed a record amount of capital for us and our goals for next year are even greater. We think there is kind of a once-in-a-cycle opportunity here with the rise of e-commerce and the dynamics at play.”

Realterm announced the acquisition of a logistics portfolio Jan. 7 alongside J.P. Morgan Asset Management. The portfolio included assets with facilities and in regions that would be beneficial to the transportation and logistics industries.

“We are incredibly excited about bringing this into our portfolio,” Fish told TT. “I really should say we’re excited to own these assets again. We acquired and owned many of these from the early 2000s up to 2013, when we ultimately sold them.”

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