In a deal involving two logistics industry stalwarts, Dallas-based Omni Logistics and Tennessee-based Forward Air Corp. have agreed to merge their companies in a cash and stock transaction, creating a combined operation that generated roughly $3.7 billion of combined adjusted revenue for the 12 months ended June 30.
Omni is majority owned by Ridgemont Equity Partners and EVE Partners LLC. Founded in 2000, it operates at over 100 locations in North America, Europe, and Asia.
“Omni has a proven track record of solving highly complex supply chain challenges through deep industry expertise, advanced proprietary technology, and a multi-disciplinary commercial engine that delivers bottom-line value to customers,” Omni CEO J.J. Schickel said in a statement. “We’re excited to have found in Forward a like-minded partner who shares our commitment to strong customer relationships and unrivaled service, central tenets of our success in growing our customer base from 300 to 7,000 over the last five years.”
Under the agreement, Omni said its shareholders will receive $150 million in cash and Forward common stock and preferred stock. Forward and Omni each will contribute their operating assets to a newly formed partnership that is a subsidiary of Forward.
Boosting its share of freight transportation
Omni is an asset-light, high-touch logistics and supply chain management company with deep customer relationships in high-growth end markets. It delivers domestic and international freight forwarding, fulfillment services, customs brokerage, distribution, and value-added services for time-sensitive freight to U.S.-based customers operating both domestically and internationally.
The companies said that the combination creates a scaled, premier, high-value, less-than-truckload (LTL) enterprise focused on providing customers with multimodal solutions for complex, high-service, and high-value freight needs.
The combined company said it will be a provider of choice and expects to compete for an increasing share of freight transportation in a dynamic market where customers are seeking a more reliable LTL solution.
The combined company said it also will benefit from an enhanced financial profile, with higher growth and significantly increased revenue underpinned by numerous cost- and revenue-based EBITDA synergy opportunities.
Aiming for maximum efficiency in LTL operations
Both the Forward and Omni businesses have a proven track record of growth and will be defined by the combined company’s focus on customer experience and efficiency, they said.
The companies said the integration of Omni’s “state-of-the-art” commercial engine will give Forward access to more than 7,000 customers, an increased domestic footprint, and a full portfolio of essential logistics services, multimodal operations, and supply chain services.
Omni said its customer base will benefit from Forward’s Precision Execution, which provides customers with “the fastest transit times, best on-time performance, and lowest claims rates in the industry.”
“The combination of Omni with Forward creates a company positioned to achieve the full potential of our LTL business, provide a broad offering of complementary services to our customers, and deliver meaningful value for our shareholders,” Tom Schmitt, chairman, president and CEO of Forward, said in a statement.
“Bringing together our organizations is a key stepping stone of the fourth and final phase of our Grow Forward journey to focus on high-value freight, develop an efficient operating network, implement strategic pricing discipline, and drive an expanded customer base,” Schmitt added. “It accelerates our ability to make high-value, competitively priced freight accessible to more customers, all of whom will benefit from Forward’s renowned Precision Execution.”
“Importantly, Forward and Omni already share a relentless focus on delivering best-in-class service to our customers, and we’re excited to advance that reputation together. We also believe the combination will allow us to unlock significant growth through enhanced scale, execution, and operational synergies,” Schmitt said.
According to the companies, the combination of Forward and Omni represents a “unique opportunity” to scale and rapidly deliver category leadership in the roughly $15 billion expedited LTL total addressable market, of which Forward currently services $1 billion.
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