This story appears in the March 9 print edition of Transport Topics.
Benton Global, a regional less-than-truckload operator in the Southeast, has closed its doors, representing the first publicly announced fleet failure this year.
Benton, based in Atlanta, shut down in late February because “the age of the inherited fleet and the bankruptcy of several customers [were] too much to overcome,” said Rob Adams, a spokesman for the company.
Adams, who is also managing director of Florida-based transport asset management firm Bluejay Advisors, told Transport Topics the shutdown occurred despite the investment of “significant capital” after Benton Express was acquired late in 2012 as a “distressed asset” by Perdue Partners. Perdue renamed the company Benton Global.
The failure of Benton occurred soon after the most recent trucking bankruptcy report from Avondale Partners showed that fleet failures were at an all-time low in the fourth quarter. Failures plummeted because of higher rates, more freight and lower fuel prices, analyst Donald Broughton said in a January report on fourth-quarter trends.
“Benton is going through an orderly liquidation filing in order to maximize the recovery of assets for creditors,” Adams said. He said details of the liquidation process are still being decided.
Benton’s doors closed at a time when other LTL fleets were reporting fourth-quarter earnings improvement.
Benton operated as many as 20 terminals in North Carolina, South Carolina, Tennessee, Georgia and Florida. Its fleet totaled about 400 tractors. Its workforce was about 500 before the company began winding down operations, Adams said.
Adams also said that Benton’s owners appreciated the tireless efforts of its employees and vendors.
Perdue Partners was formed by former Georgia Gov. Sonny Perdue (R) in early 2012. He left office in 2011.
“Benton’s closure appears to have been the result of poor management that manifested in low pay and aging equipment, among other things, while the industry has just enjoyed two prosperous years,” Jason Seidl, a Cowen and Co. analyst, said in a report.
Seidl’s report said the failure of Benton, with estimated annual revenue of $50 million or less, could provide “a slight push for industry pricing and minor benefits for LTL carriers such as Saia Inc. and Old Dominion Freight Line. There also could be a small reduction in industry capacity and some new business opportunities for competitors.”
Seidl estimated Benton’s freight volume at more than 480,000 shipments in 2013.
Adams said the company has delivered all freight that was in its system as part of the effort to have an orderly wind-down of operations.
That approach was different from some previous trucking failures. The last major LTL bankruptcy occurred last year at New Century Transportation.
That New Jersey-based company failed with little notice after its investors cut off funding. New Century was far larger than Benton. New Century, with more than 1,500 workers, had revenue of more than $266 million in 2013.
Seidl also said that tighter capacity “should be welcome news for carriers and could also sit well with LTL investors, in light of what appears to be a slight moderation in tonnage growth. We continue to believe that industry fundamentals remain intact.”