Year-End Mergers Ring the Street’s Bell

Two late-year merger announcements in trucking made a splash on Wall Street in 2000, a year marked otherwise by stagnant or falling stock prices due to concerns that high fuel costs and transportation equities are a bad mix.

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In November, FedEx Corp. (FDX) moved to create a super-regional less-than-truckload carrier with a proposal to buy American Freightways (AFWY), which would complement its Viking Freight subsidiary.

A month later, Swift Transportation Co. (SWFT) said it will absorb rival M.S. Carriers, Inc. (MSCA) to create a company with the largest market capitalization in the truckload sector.

The mergers are slated for completion in the first half of 2001.

Many of the nation’s largest truckload carriers were profitable throughout the year, yet their stock prices took a pounding on Wall Street, continuing a process that ran over from 1999.

Typically, revenues rose but profits fell from the previous year. The best of carriers were able to prevent those drops from turning into losses.

For the full story, see the Jan. 1 print edition of Transport Topics. Subscribe today.