Transforce Buys TCA 06.25.14

Client Communiqué
Transforce Buys Transport Corporation of America (TCA) 06.25.14
Montreal-based Transforce Inc. bought Minneapolis-based truckload carrier TCA for $310
million (including the assumption of $150 million in TCA debt) from Minneapolis-based
PE firm Goldner Hawn Johnson & Morrison. No real estate changes anticipated.
TCA’s terminal footprint contracted after the sale of SoCal drayage business to Roadrunner TCA acquired Birmingham-based truckload and drayage operator SoCal in 2011 and sold the drayage assets last
year to Roadrunner Freight Systems. In the process, the company exited shops and yards in port markets
(Charleston, SC, Chesapeake, VA, Mobile, AL, and Savannah, GA), larger in-land markets (Dallas, TX and
Memphis, TN) and became a pure-play asset-based truckload carrier with sales of about $350 million.
Transforce will have revenues of $3.5 billion this year, making it one of the largest and most diversified truckers in
North America.
Earlier this month, Transforce closed on Veolia’s Canadian waste business. Earlier this year it acquired the
Canadian rail-orientated LTL business of Vitran Express (18 terminals) and Clarke Transport (15 terminals).
Since 2000, the company has acquired a full suite of successful, mid-sized transportation companies in the parcel
(Loomis, DHL, ICS, Dynamex), LTL (TST, Concord, Quik-x), 3PL (ATS), energy (IR Miller, EnQuest), waste and
truckload spaces.
TCA will be one of a few dozen, considerably smaller, home-grown, regional truckload companies that comprise
Transforce’s truckload portfolio.
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Transforce Buys Transport Corporation of America (TCA) 06.25.14
Transforce’s Canadian truckload revenue accounted for about 13% of total revenue in 2013, dragging earnings.
With this acquisition, US truckload revenues will account for about 10% of total revenues. CEO Alain Bedard
reckons that US truckload fundamentals are better than those in Canada.
Canadian analysts are equally charmed: TCA fits nicely in to the Transforce acquisition model: buy a strong brand,
centralize back office functions, leave management alone and make a decision on integration once the smoke
clears. As a result, most of Transforce’s acquisitions have been accretive to cash flow and quickly deliver organic
growth to the platform over time.
From its head office in Minneapolis, MN and a Dallas, TX regional office, TCA operates:
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8 well-located garages in major markets in the US (Minneapolis, MN, Los Angeles, CA, Cedar Rapids, IA
Harrisburg, PA, Youngstown, OH, Madison, WI, Birmingham, AL and Atlanta, GA),
2 yard/offices in (Fort Wayne, IN and Laredo, TX), and an
18 door crossdock (Grove City, OH).
We expect no change TCA’s real estate footprint as a result of the deal. Look instead for TCA to become the
investment platform for more Transforce US truckload acquisitions.
Ted Morandin
410 349 9002