XPO Logistics to Acquire Bridge Terminal Transport
Matt Kelly, Risk & Insurance Due Diligence Provider
XPO Logistics will nearly triple its drayage capacity through the $100 million acquisition of Bridge Terminal Transport.
The acquisition of BTT will bring the fast-growing third-party logistics operator’s drayage fleet to more than 2,000 independent owner-operators, the company said in a first-quarter earnings release, in which XPO reported a $14.7 million loss. Intermodal volume growth, a major plank in XPO Logistics’ portfolio, isthreatened by a lack of drayage truck capacity, speakers at the NASSTRAC Shippers Conference warned last month.
BTT, one of the largest asset-light drayage providers in the U.S., has 28 terminals and some 1,300 independent owner-operators.
“It’s a company that’s been in business for 33 years,” CEO Bradley Jacobs told JOC.com Tuesday. “It’s extremely well run and they’ve built up a lot of customer loyalty in those 33 years.”
According to Jacobs, each of BTT’s top 10 customers have been doing business with the company for an average of 19 years.
The acquisition was key, Jacobs said, to one of XPO’s central goals: “building up our intermodal franchise to many times our present size.”
XPO Logistics said the deal will significantly expand its drayage presence on the East Coast, where growth in domestic intermodal volume is expected to be the most robust.
“One of the ways that we grow the business is we go to our rail partners and show them how effective we can be on the street and how well we can manage the drayage portion of the intermodal move,” Jacobs said.
At XPO, he said, drayage is considered part and parcel of the company’s intermodal network.
“Drayage is in the category of intermodal for us,” Jacobs said. “Getting more drayage capacity, becoming more efficient on the drayage portion, helps our relationships with the rails. It also helps our relationships with our customers, because it allows us to take freight that we normally would not.”
The acquisition comes just a week after XPO announced it would buy Norbert Dentressangle, one of Europe’s largest third-party logistics and transportation companies, for $3.5 billion. Since it was launched in 2002 by Jacobs, XPO Logistics has acquired more than a dozen companies, ranging from freight brokerage and forwarding firms to intermodal rail, contract logistics, expedited transport and last-mile logistics businesses.
In a statement, Jacobs said a weak spot market for freight brokerage and intermodal service disruptions caused by West Coast port congestion offset growth in XPO Logistics’ last mile and expedited divisions. The company’s first-quarter net revenue soared 349 percent year-over-year, to $262 million.