Yellow Roadway Moves Into Next-day Markets With USF Acquisition
Staff -- Tradeshow Week, 6/13/2005
One less large transportation company exists with Yellow Roadway's $1.5 billion acquisition of Chicago-based USF.
The merger creates a company with more than $9 billion in revenue and $6 billion in assets, as well as 90,000 trailers, 25,000 trucks and 70,000 employees.
"The USF logo looks pretty good with the rest of the logos in the company," Yellow Roadway CEO Bill Zollar said in a conference call with investors. "One of the things that was important to us, as this consolidation in our industry continues, is that we make sure we were one of four or five players left standing."
The acquisition allows Yellow Roadway to expand into the next-day and regional markets. About 29 percent of the combined company's business is now next-day service, another 29 percent second-day service, 23 percent third-day service and the remainder beyond that time frame.
"It gives us a very nicely balanced portfolio of services," Zollar said.
The merger is expected to save Yellow $40 million within the next year. The USF brand and New Penn Motor Express will be organized into a unit called YRC Regional Transportation. The unit will be headquartered in Akron, Ohio, and headed by Jim Staley, former president of the Roadway Group.
The acquisition comes two years after Yellow purchased Roadway, a fellow less-than-truckload carrier. Consolidated Freightways, another LTL carrier, closed its doors several months before that.
Yellow Roadway officials plan to continue to use the USF brand, as was the case with Yellow's acquisition of Roadway. Despite the wave of consolidations, there's still no shortage of transportation companies. In addition to larger companies offering a range of transportation services, a number of companies specifically target exhibit transportation.
