Forward Air and Omni Logistics announce plans to combine, with a focus on expedited LTL market

Earlier today, Greenville, Tenn.-based asset-light freight and logistics services providerForward Airand Dallas-basedOmni Logistics, an asset-light, high-touch logistics and supply chain services provider owned byRidgemont Equity Partnersannounced today they will join forces, with the companies having entered into a definitive agreement to create a combined company through a cash-and-stock transaction.

The companies’ generated roughly $3.7 billion in adjusted revenue through the 12-month period ending June 30, 2023, according to Forward, adding that Omni shareholders will receive $150 million in cash and Forward common stock, as per terms of the agreement. The transaction is expected to be made official later this year and has been approved by the Boards of Directors of both companies.

Established in 2000, Omni provides shippers with various offerings, including domestic and international freight forwarding, fulfillment services, customs brokerage, and distribution and value-added services for time-sensitive freight to U.S.-based companies on a domestic and international basis.

“The combination of Omni with Forward creates a company positioned to achieve the full potential of ourLTLbusiness, provide a broad offering of complementary services to our customers, and deliver meaningful value for our shareholders,” saidTom Schmitt董事长,总裁兼首席执行官Forward, 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. 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 are 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. We look forward to benefitting from Omni’s unique capabilities and expertise and to bringing even greater value into the expedited freight marketplace.”

The companies cited myriad benefits of this transaction, including:

• creating a scaled, premier, high-value, less-than-truckload enterprise focused on offering shippers with multimodal solutions for complex, high-service and high-value freight needs;
• integrating Omni’s state-of-the-art commercial engine providing Forward with access to more than 7,000 customers, an increased domestic footprint, and a full portfolio of logistics services, multimodal operations, and supply chain services; and
• Omni’s customers seeing benefits from Forward’s Precision Execution, providing customers with some of the fastest industry transit times, on-time performance, and lowest claim rates, among other benefits

更重要的是,这两家公司表示,这交易ion is expected to deliver synergies via the insourcing of Omni’s third-party LTL network and also other domestic transport spend to leverage and capitalize on cross-selling opportunities that could result in up to around $125 million in total run-rate EBITDA synergies.

A key strategic benefit of this transaction identified by the companies includes advancing category leadership in expedited LTL freight in the roughly $15 billion expedited LTL total addressable market, with Forward servicing $1 billion of this market. They added that the combined company will see benefits from a direct-to-market salesforce and increased footprint.

Other cited strategic benefits included: the combined company offering complementary services, including expedited services, intermodal transfer, truckload brokerage, and warehouse and distribution capabilities, coupled with the long-term growth of Forward’s LTL business being a competitive differentiator for the combined company; enhancing platform scale; combining industry-leading teams; expanding its geographic footprint and capacity to better serve the its LTL network; and expanding Forward’s expedited freight customer base.

When the transaction becomes official, Forward’s Schmitt will remain as Chairman and CEO, and J.J. Schickel, Omni Logistics CEO, will be President and also join Forward’s Board of Directors.

“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,” said Schickel in a statement. “We are 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. I am very proud of what Omni accomplishes daily for our customers and am thrilled to bring our companies and teams together to achieve the full potential of our combined force.”

Forward has been very active on the acquisition front of late, having acquiredChicksaw Container Services in November 2022, andLand Air Express in January 2023.

Ben Gordon, founder and managing partner of Palm Beach, Florida-based Cambridge Capital, and managing partner of Ben Gordon Strategic Advisors (BGSA), described this deal as striking, in a sense.

“The union battle that took down Yellow creates an opportunity for another LTL giant,” he said. “Although Omni and Forward Air have asset light strengths, they also provide the market with an LTL network that could provide an alternative. This deal also highlights the fact that logistics mergers and acquisitions are back!”