UPS is acquiring carrier Overnite in a $1.25 billion cash transaction. UPS is paying $43.25 per share for the company that will expand its ground services.
Overnite will provide UPS with a variety of less-than-truckload (LTL) and truckload (TL) services to its North American customers. UPS will become the top U.S. LTL carrier. Five months ago, the company expanded its air freight services by acquiring Menlo Worldwide Forwarding.
“Overnite is a perfect strategic fit for our company,” said UPS Chairman and CEO, Mike Eskew. “We want to offer our customers the broadest portfolio of transportation and logistics services available from a single source and this is an important capability that we needed to have.
Overnite is based in Richmond, Virginia. It reported net income of $63.3 million for last year on revenue of $1.65 billion. Overnite serves over 60,000 customers in the LTL and TL segments with operations in the U.S., Canada, Mexico, Puerto Rico, Guam and the U.S. Virgin Islands.
“Overnite is a successful, well-run company with excellent growth prospects and has a strong culture and world-class employee base that complement our organization,” said Eskew.
“This is an exciting time for Overnite and its customers and employees,” said Leo Suggs, Overnite’s chairman, CEO and president. “We are pleased that UPS recognizes our commitment to quality service, our broad nationwide coverage and a trained and motivated workforce. We are confident in our ability to help UPS broaden its diverse service portfolio to its customers.”
The Overnite acquisition, is expected to close during the third quarter of this year and is subject to regulatory approvals and the approval of Overnite’s shareholders.
The Overnite Board of Directors has unanimously approved the agreement and recommended approval by its shareholders. Overnite’s management team is expected to remain in place to run the business.
Chris is a staff writer for murdok. Visit murdok for the latest ebusiness news.
