TFI Buys Tank Truck Specialist Vedder in Ninth Deal of 2023
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Montreal-based TFI, which ranks No. 4 on the Transport Topics Top 100 list of the largest for-hire carriers in North America, did not disclose the terms of the deal.
Vedder, which specializes in the tank truck transportation of food-grade liquids and dry bulk commodities, is headquartered in Abbotsford, British Columbia, and fills a hole in TFI’s Western Canadian footprint. Per a TFI release, Vedder was one of the first companies in Western Canada to use tanker trucks to transport liquid food-grade products. Vedder, which was founded in 1956, now has operations that span from its home province east to Manitoba.
Vedder has more than 155 tractors and nearly 300 trailers in addition to warehousing and maintenance and repair facilities, a food-grade wash rack and railcar transload capability, TFI said. Vedder generates annual revenues in excess of C$80 million ($58.5 million).
“For many years, TFI International has been a leading provider of reliable, safe and cost-effective tank truck services to the liquid and dry bulk food-grade market in Eastern Canada,” said TFI CEO Alain Bédard. “With the acquisition of Vedder, we add the premier provider of such services in Western Canada along with a network of strategically located facilities, making TFI the premier Canadian coast-to-coast provider of food-grade tank truck transportation services.”
The latest deal is part of TFI’s strategy of finding tuck-in acquisitions, said Kevin Chiang, CIBC World Markets institutional equity research director. The purchase is the second for TFI in the back half of 2023; it acquired JHT Holdings in August. Pleasant Prairie, Wis.-based JHT transports Classes 6 through 8 trucks from manufacturing and final assembly plants to dealers and customers.
These acquisitions follow a stretch during which TFI inked seven deals in the first half of 2023 in the United States and Canada. During TFI’s first-quarter 2023 earnings call, Bédard said TFI is strategically expanding its geographic reach and capabilities. He noted that generally accepted modus operandi for mergers and acquisitions is to buy on bad news and sell on good news and said that the declining freight market has produced plenty of the former. “We love this environment for M&A,” he said.
TFI expects to spend $250 million on M&A in the second half of 2023. The company’s top executive said that by the end of 2023 or at the start of 2024, a big deal would be unveiled.
Further deals are expected in 2024, as the company has said it expects to spend $300 million-$400 million a year on M&A going forward, Chiang said.
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