Virginian-based UPS Freight being sold to TFI for $800M
RICHMOND, Va. (AP) — UPS has reached an agreement to sell the Virginia-based UPS Freight to Canadian trucking giant TFI International for $800 million.
Both companies announced their agreement in a statement Monday, saying the deal is expected to close in the second quarter of 2021 pending regulatory approvals.
Approximately 90% of the acquired business will operate under a new name “TForce Freight,” which will continue to serve UPS’ less-than-truckload operations, according to Montreal-based TFI. The company says the remaining assets will join TFI’s truckload business segment.
UPS Freight, which generated an estimated $3 billion in revenue last year, is one of the largest less-than-truckload carriers in the U.S. Those operators typically use trucks for bulk shipments.
TFI CEO Alain Bédard called the agreement a “highly strategic transaction” that will make the company one of the largest North American less-than-truckload carriers.
Bédard had said during a conference call with investors on Monday that UPS’ freight unit was “like a loss leader for UPS,” and promised to change the business approach, The Atlanta Journal-Constitution reported. Meanwhile, UPS Chief Executive Officer Carol Tomé said the agreement will allow UPS “to be even more laser-focused on the core parts of our business that drive the greatest value for our customers.”
The companies also will enter into an agreement that will allow the trucks to continue to use UPS’ domestic package network to fulfill shipments for a period of five years.
All of UPS Freight’s 14,500 workers will become employees of TFI when the deal is finalized, The Richmond Times-Dispatch reported. About 80% of them are full-time workers.