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Werner Enterprises and TFI International completed separate acquisitions Nov. 29 to bolster their operations.
Werner signed a definitive agreement to acquire the Monroe, Conn.-based final-mile carrier NEHDS Logistics. The transportation and logistics company said the acquisition will help it expand its final-mile capabilities primarily in the Northeast and Midwest. NEHDS also was expanding in the Mid-Atlantic and Southeast.
TFI, based in Montreal, expanded its reach into the U.S. by acquiring Carthage, Mo.-based trucking company D&D Sexton. TFI said the company will operate within its CFI group of companies. Terms were not disclosed.
“The addition of the NEHDS operations, management team, talented staff and strong customer relationships to the Werner family represents a significant step forward in our final-mile delivery program,” Werner CEO Derek Leathers said.
The $64 million purchase price includes a $4 million earnout. NEHDS achieved annual revenues of $71.4 million for the 12 months ended Sept. 30. The company also produced an average annual revenue growth rate of 27% over the past three years. Werner financed the transaction through a combination of cash on hand and existing credit facilities.
“The combination of award-winning service that NEHDS provides to its clients, along with the comprehensive portfolio of trucking capability, final-mile logistics services and technology will bring the Werner and NEHDS customer base many advantages,” Leathers said.
NEHDS operates a fleet of more than 400 delivery trucks. The company primarily delivers big and bulky products using two-person delivery teams performing residential and commercial deliveries through a network of 19 crossdock, warehouse and customer facilities.
Werner plans to integrate those operations with its nationwide final-mile home delivery network for big and bulky products. NEHDS will be rebranded into Werner Final Mile while its leadership team, drivers, nondriver associates and independent contractors will remain with the business. NEHDS financial results will be included in the Werner Logistics segment beginning in the fourth quarter.
“Both companies share a passion for valuing its professional drivers, associates and customers,” Leathers said. “We look forward to welcoming the NEHDS team and working together to maintain and grow the excellent relationships with current customers, independent contractors, employee drivers and office associates.”
Zacks Equity Research noted the acquisition is prudent with demand for final-mile delivery services increasing amid the coronavirus pandemic. Werner closed one other acquisition this year with the purchase of ECM Transport in July.
Werner ranks No. 17 on the Transport Topics Top 100 list of largest for-hire carriers in North America and No. 30 on the TT Top 50 list of largest logistics companies.
Koley Jessen P.C., L.L.O. served as legal counsel to Werner Enterprises. Eckert Seamans Cherin & Mellott, LLC served as legal counsel to NEHDS.
TFI Chairman and President Alain Bédard said D&D complemented the acquiring company.
“D&D is an excellent strategic fit with the organization, culture and business model of our CFI operating company,” Bédard said, “adding strategic capacity and valuable, long-standing customer relationships to its temperature-controlled business.
“In addition to an overlapping refrigerated freight network, D&D brings significant experience in local and shuttle operations.”
Family-owned D&D specializes in refrigerated transportation that generates annualized revenue in excess of $25 million. It provides longhaul over-the-road services as well as local and shuttle operations with more than 150 company drivers operating more than 120 tractors. The company also has nearly 400 refrigerated and dry van trailers.
“We see multiple near-term opportunities around costs, routes and pricing to enhance profitability, as well as longer-term opportunities to optimize equipment and the capacity network design, taking D&D to the next level of excellence,” Bédard said. “We extend our warmest welcome to the entire D&D team and look forward to their many upcoming contributions to TFI International’s continued growth.”
TFI manages a network of wholly owned subsidiaries that operate across the United States, Canada and Mexico. The company also has grown its network through acquisitions. TFI earlier in the year acquired less-than-truckload and dedicated truckload shipments company UPS Freight.
TFI International ranks No. 5 on the for-hire TT100.
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