XPO’s Biggest Deal Yet Sets It Up as Buyer or Seller: Real M&A
2015-04-29 18:34:50.15 GMT
(For a Real M&A column news alert: {SALT REALMNA <GO>}.)
By Brooke Sutherland
(Bloomberg) -- XPO Logistics Inc. investors who liked the
company’s biggest acquisition have more to look forward to.
The latest purchase, a takeover of French trucking company
Norbert Dentressangle SA for $3.53 billion including net debt,
will make the manager of cargo shipments a one-stop shop for
supply-chain services and allow it to tap into a larger base of
multi-national customers, said David Campbell, an analyst at
Thompson Davis & Co. The combined company will have about $8.5
billion in revenue, more than triple XPO’s sales last year.
XPO Chief Executive Officer Brad Jacobs says this is only
the “early innings” of the company’s growth plan. That’s
fueling expectations for more deals in Europe or elsewhere.
Shares of the $3.9 billion company surged as much as 16.4
percent on Wednesday, touching a new high.
“This is a cornerstone acquisition for them,” Scott
Schneeberger, an analyst at Oppenheimer Holdings Inc., said in a
phone interview. “It gets them a beachhead in Europe. But these
guys are built to do more than one deal at a time even if they
did a big one.”
Takeover ‘Endgame’
As it joins the ranks of the world’s top logistics
providers, XPO also could find itself in an acquirer’s sights,
said Kevin Sterling of BB&T Corp. The company could be an
attractive consolation prize for United Parcel Service Inc.,
whose attempt to take over TNT Express NV was foiled by
regulators, Sterling said. FedEx Corp. agreed on April 7 to buy
TNT for $4.8 billion.
“That could be the endgame for XPO in a couple of years,”
he said in a phone interview. “Look at the acquisition spree
that FedEx has been on recently. UPS is sitting on a ton of
cash. Ultimately, down the road, could XPO be a potential
target? You’ve got to think they’d be on UPS’s radar screen.”
A representative for Atlanta-based UPS said the company
doesn’t comment on speculation.
Jacobs has built companies up to sell them before. He
founded United Waste Systems Inc. in 1989, and then about 250
acquisitions later, sold it to the company now known as Waste
Management Inc. for more than $2 billion in 1997. He struck a
deal to sell United Rentals Inc. to Cerberus Capital Management
in 2007 but the private-equity firm walked away amid the credit-
market collapse.
For Related News and Information:
UPS Tops Profit Forecast With Boost From Overseas Deliveries
FedEx’s TNT Offer Shows Less Is More Three Years Later: Real M&A
XPO Logistics Buying Norbert in $3.53 Billion European Deal
XPO’s Jacobs Pulls Off 500 Deals Bypassing Wall Street Bankers
Top deal news: DTOP <GO>
Real M&A columns: NI REALMNA <GO>
To contact the reporter on this story:
Brooke Sutherland in New York at +1-212-617-0448 or
bsutherland7@bloomberg.net
To contact the editors responsible for this story:
Beth Williams at +1-212-617-2307 or
bewilliams@bloomberg.net
Elizabeth Wollman
2015-04-29 18:34:50.15 GMT
(For a Real M&A column news alert: {SALT REALMNA <GO>}.)
By Brooke Sutherland
(Bloomberg) -- XPO Logistics Inc. investors who liked the
company’s biggest acquisition have more to look forward to.
The latest purchase, a takeover of French trucking company
Norbert Dentressangle SA for $3.53 billion including net debt,
will make the manager of cargo shipments a one-stop shop for
supply-chain services and allow it to tap into a larger base of
multi-national customers, said David Campbell, an analyst at
Thompson Davis & Co. The combined company will have about $8.5
billion in revenue, more than triple XPO’s sales last year.
XPO Chief Executive Officer Brad Jacobs says this is only
the “early innings” of the company’s growth plan. That’s
fueling expectations for more deals in Europe or elsewhere.
Shares of the $3.9 billion company surged as much as 16.4
percent on Wednesday, touching a new high.
“This is a cornerstone acquisition for them,” Scott
Schneeberger, an analyst at Oppenheimer Holdings Inc., said in a
phone interview. “It gets them a beachhead in Europe. But these
guys are built to do more than one deal at a time even if they
did a big one.”
Takeover ‘Endgame’
As it joins the ranks of the world’s top logistics
providers, XPO also could find itself in an acquirer’s sights,
said Kevin Sterling of BB&T Corp. The company could be an
attractive consolation prize for United Parcel Service Inc.,
whose attempt to take over TNT Express NV was foiled by
regulators, Sterling said. FedEx Corp. agreed on April 7 to buy
TNT for $4.8 billion.
“That could be the endgame for XPO in a couple of years,”
he said in a phone interview. “Look at the acquisition spree
that FedEx has been on recently. UPS is sitting on a ton of
cash. Ultimately, down the road, could XPO be a potential
target? You’ve got to think they’d be on UPS’s radar screen.”
A representative for Atlanta-based UPS said the company
doesn’t comment on speculation.
Jacobs has built companies up to sell them before. He
founded United Waste Systems Inc. in 1989, and then about 250
acquisitions later, sold it to the company now known as Waste
Management Inc. for more than $2 billion in 1997. He struck a
deal to sell United Rentals Inc. to Cerberus Capital Management
in 2007 but the private-equity firm walked away amid the credit-
market collapse.
For Related News and Information:
UPS Tops Profit Forecast With Boost From Overseas Deliveries
FedEx’s TNT Offer Shows Less Is More Three Years Later: Real M&A
XPO Logistics Buying Norbert in $3.53 Billion European Deal
XPO’s Jacobs Pulls Off 500 Deals Bypassing Wall Street Bankers
Top deal news: DTOP <GO>
Real M&A columns: NI REALMNA <GO>
To contact the reporter on this story:
Brooke Sutherland in New York at +1-212-617-0448 or
bsutherland7@bloomberg.net
To contact the editors responsible for this story:
Beth Williams at +1-212-617-2307 or
bewilliams@bloomberg.net
Elizabeth Wollman