UPS to Sell UPS Freight to TFI International Inc.
According to a company press release, United Parcel Service Inc. has entered into an agreement to sell UPS Freight to TFI International INC for $800 million. The agreement, subject to working capital and other adjustments, is expected to close during the second quarter of 2021 and includes UPS less-than-truckload (LTL) and full-truckload (FT) businesses.
UPS and TFI International also plan to enter into an agreement for UPS Freight to continue to utilize UPS’ domestic package network to fulfil shipments, for a period of five years.
“We’re excited about the future and the opportunities this creates for both UPS and UPS Freight as part of TFI International Inc.,” said UPS Chief Executive Officer Carol Tomé. “The agreement allows UPS to be even more laser-focused on the core parts of our business that drive the greatest value for our customers.”
Headquartered in Richmond, VA, UPS Freight has been in operation for over 85 years and is one of the largest LTL carriers in the U.S., with 2019 revenue of $74 billion. With over 500,000 employees, the company embraces a strategy a simple strategy: Customer First. People Led. Innovation Driven. The company services customers in more than 220 countries and territories and offers a broad range of integrated logistics solutions, including regional and long-haul services.
The statement says the decision to sell UPS Freight was reached following a thorough evaluation of the UPS portfolio and aligns with the company’s “better, not bigger” strategic positioning.
UPS expects to recognize a non-cash, pre-tax impairment charge of approximately $500 million on its statement of consolidated income for the year ended December 31, 2020. The deal remains subject to customary closing conditions and regulatory approvals.
King & Spalding LLP, whose deal team is comprised of Rahul Patel, John Hyman, Tim FitzSimons, Josh Kamin and Tom Knox is serving as legal advisor on the matter. Goldman Sachs & Co. LLC is serving as financial advisor.
