newsworthy
ABF’s parent to buy
Panther Expedited
Arkansas Best Corp., the parent of less-than-truckload (LTL) carrier
ABF Freight System Inc., has acquired Panther Expedited Services
Inc. from private equity firm Fenway Partners LLC for $180 million
in cash and debt.
The transaction, which took place in mid-June, gives Fort Smith,
Ark.-based Arkansas Best a firmer foothold in the time-critical, or
“expedited,” logistics market. Panther, based in Seville, Ohio, is
believed to be the second-largest player in the segment, behind FedEx
Customs Critical, the expedited delivery unit of giant FedEx Corp.
Under the transaction, Panther will operate as a wholly owned subsidiary of Arkansas Best and as a sister company to ABF. Andrew
Clarke, Panther’s president and CEO, will remain with Panther in the
same role. All other members of the company’s executive team are
expected to remain as well, Arkansas Best said in a statement.
In 2011, Panther reported gross revenue—revenue before the cost
of purchasing transportation—of $215 million. It reported a net loss
of $3.4 million, but posted earnings before interest, taxes, depreciation, and amortization of $24 million.
Founded in 1992 as an asset-light expedited service provider with
heavy exposure to the automotive industry, Panther has diversified
over the years into other areas of logistics services. For example,
Panther today has a significant presence in international freight forwarding, which was not the case 10 to 15 years ago. The company has
about 11,000 customers worldwide.
Fenway acquired Panther in 2005 and in a statement characterized
it as having been a “successful investment” for the firm.
EXPANDED PORTFOLIO
Panther is an “excellent strategic fit for our company and our customers as we seek to offer end-to-end logistics solutions for progressively more complex supply chains,” said Judy R. McReynolds,
Arkansas Best’s president and CEO, in a statement.
Clarke said in the same statement that although both companies
offer expedited transport services, they have “different, complemen-
tary operating models and minimal customer overlap.”
Michael P. Regan, chairman of TranzAct Technologies Inc., an
Elmhurst Village, Ill.-based transport consultancy, applauded the
move, saying the acquisition is a necessary step for ABF to broaden
what had been largely a plain-vanilla portfolio.
Unlike rivals that have both regional and national trucking operations as well as expanding non-asset-based logistics operations, “ABF is
known just as a unionized longhaul carrier,” Regan said. The Panther
purchase dramatically expands ABF’s value proposition, he added.
Regan said it would be interesting to see how ABF executes the integration of Panther, noting that the company, unlike some of its rivals,
has chosen to expand organically rather than through acquisition. As
a result, it has little experience incorporating another corporate culture into its system. ;
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