Roadrunner Announces Agreement to Sell its Prime Distribution Services Business to C.H. Robinson
January 28 2020 - 4:15PM
Business Wire
Roadrunner Transportation Systems, Inc. (“Roadrunner” or the
“company”) (NYSE: RRTS), a leading asset-right transportation and
asset-light logistics service provider, today announced it has
signed a definitive agreement for the sale of its Prime
Distribution Services business to C.H. Robinson Worldwide, Inc.
(Nasdaq: CHRW) for $225 million in cash, subject to customary
purchase price adjustments. The transaction is subject to customary
closing conditions, including regulatory approval, and is expected
to close by the end of the first quarter.
Prime Distribution Services, headquartered in Plainfield,
Indiana, provides a comprehensive suite of retail consolidation
solutions, with five food grade warehouse facilities strategically
located across the nation and a team of retail supply chain experts
dedicated to helping clients achieve compliance with large U.S.
retailer delivery and in-stock requirements. The business had
revenue of $108.7 million for the year ended December 31, 2019 and
is part of the company’s Ascent Global Logistics segment.
“The divestiture of Prime Distribution Services is a unique
opportunity for us to significantly improve our balance sheet by
paying off all borrowings under our ABL and Term Loan Credit
Facilities. We believe we are well positioned to execute our
strategy of simplifying our portfolio by investing in our remaining
Ascent Global Logistics, Active On-Demand and asset light LTL
segments. We also believe that our stronger balance sheet will
enable us to pursue additional value-creation opportunities, such
as incremental organic business expansion and tuck-in acquisitions.
We remain committed to improving operating performance, generating
attractive returns on invested capital and building long-term
shareholder value,” said Curt Stoelting, Chief Executive Officer of
Roadrunner.
“We have great respect for C.H. Robinson, its management team
and employees. We know the C.H. Robinson team shares our commitment
to customers and is dedicated to providing quality logistics
services that help customers operate and grow their business,”
added Stoelting.
Oppenheimer & Co. Inc. acted as financial advisor and
Debevoise & Plimpton LLC served as legal advisor to Roadrunner
on the transaction.
About Roadrunner Transportation Systems, Inc.
Roadrunner Transportation Systems is a leading asset-right
transportation and asset-light logistics provider offering a full
suite of services and solutions under the Roadrunner®, Active
On-Demand® and Ascent Global Logistics® brands. The Roadrunner
brand offers less-than-truckload and over-the-road truckload
services. Active On-Demand offers premium mission critical air and
ground logistics solutions. Ascent Global Logistics offers domestic
freight management, international freight forwarding and customs
brokerage. For more information, please visit Roadrunner’s
websites, www.rrts.com and www.ascentgl.com.
About C.H. Robinson
C.H. Robinson solves logistics problems for companies across the
globe and across industries, from the simple to the most complex.
With nearly $20 billion in freight under management and 18 million
shipments annually, C.H. Robinson is one of the world’s largest
logistics platforms. For more information, visit www.chrobinson.com
(Nasdaq: CHRW).
Safe Harbor Statement
This press release contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended, which relate to future events or performance.
Forward-looking statements include, among others, statements
regarding Roadrunner’s belief that the divestiture of Prime
Distribution Services will significantly improve the company’s
balance sheet; that the company is well positioned to invest in its
remaining segments; that the company will be enabled to pursue
additional value-creation opportunities, such as incremental
organic business expansion and tuck-in acquisitions; and the
company’s commitment to improving operating performance, generating
attractive returns on invested capital and building long-term
shareholder value. Forward-looking statements are often, but not
always, made through the use of words or phrases such as “may,”
“will,” “anticipate,” “estimate,” “plan,” “project,” “continuing,”
“ongoing,” “expect,” “believe,” “intend,” “predict,” “potential,”
“opportunity,” and similar words or phrases or the negatives of
these words or phrases. These forward-looking statements are based
on Roadrunner’s current assumptions, expectations and beliefs and
are subject to substantial risks, estimates, assumptions,
uncertainties and changes in circumstances that may cause
Roadrunner’s actual results, performance or achievements to differ
materially from those expressed or implied in any forward-looking
statement. Such factors include, among others, risks related to the
restatement of Roadrunner’s previously issued financial statements,
the remediation of Roadrunner’s identified material weaknesses in
its internal control over financial reporting, and the other risk
factors contained in Roadrunner’s SEC filings, including
Roadrunner’s Annual Report on Form 10-K for the year ended December
31, 2018. Because the risks, estimates, assumptions and
uncertainties referred to above could cause actual results or
outcomes to differ materially from those expressed in any
forward-looking statements, you should not place undue reliance on
any forward-looking statements. Any forward-looking statement
speaks only as of the date hereof, and, except as required by law,
Roadrunner assumes no obligation and does not intend to update any
forward-looking statement to reflect events or circumstances after
the date hereof.
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version on businesswire.com: https://www.businesswire.com/news/home/20200128005676/en/
Reputation Partners Marilyn Vollrath 414-376-8834
ir@rrts.com
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