XPO Logistics has completed its second acquisition in as many weeks, purchasing the logistics firm Covered Logistics & Transportation for $8 million in cash and $3 million in XPO stock.
The company will be rebranded as XPO, but current management will stay in place.
In mid-February, XPO purchased East Coast Air Charter for $9.25 million, part of its move to expand into air charter services.
In total, XPO has purchased six companies in the past nine months and is looking to add additional companies with a total historical revenue of $300 million.
“Don’t count on us doing one every two weeks,” Chief Executive Officer Brad Jacobs told American Shipper
. “We’ll do at least three more acquisitions this year. We’re looking at acquisitions of all different sizes.”
XPO targeted Covered Logistics because of its 4,000 carrier relationships and strong presence in oil and gas, postal and manufacturing markets. More significantly, though, Jacobs said the Covered Logistics team simply knew the business well.
“They have good relationships with carriers, and they have good relationships with their core customers,” he said. “They know how to run the business, and we like to bring people into the organization who are winners and have demonstrated track records of knowing how to service customers and take care of carriers.”
Fourth quarter revenue for XPO was up, year over year, by 146.1 percent to $108.5 million, and gross margin dollars increased by 118.4 percent.
At $71.1 million, the freight brokerage business generated 760 percent more revenue during the quarter. Freight forwarding generated 10 percent more revenue, year over year, at $18.5 million.
XPO’s 2012 numbers tell a story of rampant growth through acquisitions and new brokerage locations. Once new businesses are acquired or new locations are developed, XPO officials aggressively expand their holdings, adding employees and resources.
“And that’s our plan,” Jacobs said, “and that’s the plan we’re going to keep doing.” - Jon Ross