Werner Enterprises, Inc. (Nasdaq: WERN), one of the nation’s
largest transportation and logistics companies, today announced it
has signed a definitive agreement and closed on the acquisition of
an 80% equity ownership stake in ECM Transport Group (“ECM”) for a
purchase price of $142.4 million and retains an exclusive option to
buy the remaining 20% of ECM Transport Group after a period of five
years. With 2020 revenues of $108 million, ECM consists of ECM
Transport and Motor Carrier Services of Pennsylvania who are elite
regional truckload carriers that operate nearly 500 trucks and
2,000 trailers in their network of 8 terminals and 18 drop yard
facilities.
“The addition of ECM’s skilled drivers,
non-driver associates and terminal network strengthens our
portfolio by adding short-haul expertise in a segment in which
consumer demand and supply chain needs are growing,” said Derek
Leathers, Chairman, President and Chief Executive Officer. “This
transaction delivers on our ‘5 Ts + S’ strategy and will position
us for further growth as we capitalize on positive market dynamics
for the remainder of 2021 and beyond. We expect this transaction to
be accretive in year one and anticipate cost synergies through
integrated management of our combined fleet.”
Strategic and Financial
Benefits
Expands footprint in the strategic
Mid-Atlantic, Ohio and Northeast regions
- Complementary to Werner’s existing
terminal footprint
- Increased exposure to the 200 to
300 mile length of haul segment, in support of expected continued
demand growth
Adds high-quality talent and increases
Werner’s fleet size by over 6%
- Addition of over 500
highly-skilled, tenured drivers in a constrained labor market
- Fleet of nearly 500 trucks and
2,000 trailers
- Extremely low driver turnover
- Synergies expected through combined
management of fleet
Combines similar cultures focused on
safety and customer service excellence
- Highest standards of driver
training and safe operations
- Continuous investment in technology
and IT infrastructure to enhance on-time delivery performance
- Shared values of picking winning
customers with high expectations, establishing long-term mutual
service and revenue objectives, and delivering best-in-class
performance to stabilize volume and minimize churn
- Existing ECM leadership (including
founder and President Ed Meier), drivers and non-driver associates
will remain in place and we are retaining the ECM brand to ensure
smooth integration and high driver retention
- ECM will operate as a standalone
business unit within Werner and their financial results will be
reported in Werner’s One-Way Truckload unit within Truckload
Transportation Services
Leathers continued, “Both companies believe
deeply that our professional drivers are the backbone of our
organizations. We look forward to welcoming the ECM team and
working together to create additional value for our customers and
shareholders.”
“We are excited to join the Werner team and look
forward to continued growth as we leverage our collective strengths
to serve our existing and new customers at even higher levels. We
are standing by our existing customers and will continue to provide
them with excellent service. Werner shares our passion for
delivering value and continually creating personal and professional
opportunities for our accomplished team of professional drivers and
non-driver associates,” said Ed Meier, President of ECM.
Transaction Financing and
Terms
Werner financed the transaction through a
combination of cash on hand, existing credit facilities and a new
$100 million fixed-rate term loan maturing in May 2024 with BMO
Harris Bank N.A., one of Werner’s two lead banks. Closing for the
acquisition was completed today. The remaining 20% ownership
interest in ECM Transport Group will be retained by Ed Meier,
founder and President of ECM. As previously mentioned, Werner
Enterprises retains an exclusive option to buy the remaining 20% of
ECM Transport Group after a period of five years.
Conference Call Information
Werner Enterprises, Inc. will conduct a
conference call to discuss the acquisition Friday July 2, 2021 at
8:00 a.m. CT. The news release, live webcast of the conference
call, and accompanying slide presentation will be available at
www.werner.com in the “Investors” section under “News & Events”
and then “Webcasts & Presentations.” To participate in the
conference call, please dial (844) 701-1165 (domestic) or (412)
317-5498 (international). Please mention to the operator that you
are dialing in for the Werner Enterprises call. A replay of the
conference call will be available on July 2, 2021 in the
evening through August 2, 2021 by dialing (877) 344-7529 (domestic)
or (412) 317-0088 (international) and using the access code
10158045. A replay of the webcast will also be available at
www.werner.com in the “Investors” section under “News & Events”
and then “Webcasts & Presentations.”
About Werner Enterprises
Werner Enterprises, Inc. (Nasdaq: WERN) delivers
superior truckload transportation and logistics services to
customers across the United States, Mexico and Canada. With 2020
revenues of $2.4 billion, an industry-leading modern truck and
trailer fleet, nearly 13,000 talented associates and our innovative
Werner Edge technology, we are an essential solutions provider for
customers who value the integrity of their supply chain and require
safe and exceptional on-time service. Werner provides Dedicated and
One-Way Truckload services as well as Logistics services that
include truckload brokerage, freight management, intermodal and
final mile. As an industry leader, Werner is deeply committed to
promoting sustainability and supporting diversity, equity and
inclusion.
About ECM Transport Group
ECM Transport Group (“ECM”), consists of ECM
Transport, with approximately 450 trucks and headquartered in
Cheswick, PA, and Motor Carrier Services of Pennsylvania,
headquartered in Northwood, Ohio with approximately 50 trucks. They
have been providing truckload services for over 30 years. Initially
founded as a traditional truckload carrier, ECM has diversified
itself as a transportation solutions provider and technology
innovator, committed to delivering unique, high-value and
customized solutions to its customers. ECM has a network of 8
terminals and 18 drop yards throughout the Mid-Atlantic, Ohio and
Northeast regions.
Advisors
Koley Jessen P.C., L.L.O. served as legal counsel to Werner
Enterprises. Saul Ewing Arnstein & Lehr LLP served as counsel
to ECM Transport Group.
Forward Looking Statements
This press release may contain 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, and made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995,
as amended. Such forward looking statements are based on
information presently available to the Company’s management and are
current only as of the date made. Actual results could also differ
materially from those anticipated as a result of a number of
factors, including, but not limited to, those discussed in the
Company’s Annual Report on Form 10-K for the year ended December
31, 2020 and Quarterly Report on Form 10-Q for the period ended
March 31, 2021.
For those reasons, undue reliance should not be
placed on any forward-looking statement. The Company assumes no
duty or obligation to update or revise any forward-looking
statement, although it may do so from time to time as management
believes is warranted or as may be required by applicable
securities law. Any such updates or revisions may be made by filing
reports with the U.S. Securities and Exchange Commission, through
the issuance of press releases or by other methods of public
disclosure.
Contact:John J. SteeleExecutive Vice President,
Treasurerand Chief Financial Officer(402) 894-3036Source: Werner
Enterprises, Inc.
Werner Enterprises (NASDAQ:WERN)
Historical Stock Chart
From Apr 2024 to May 2024
Werner Enterprises (NASDAQ:WERN)
Historical Stock Chart
From May 2023 to May 2024