XPO Logistics buys freight brokerage firm for $50 million
(Reuters) - XPO Logistics Inc (XPO.N) confirmed it acquired the freight brokerage division of Ozburn-Hessey Logistics, a logistics company owned by private equity firm Welsh Carson, for $50 million in cash.
The acquisition of Turbo Logistics will immediately add to XPO's earnings, the company said in a statement on Thursday.
Turbo, which has revenue of about $120 million, provides expedited transportation and temperature-controlled trucking services.
XPO, valued by the market at about $220 million, has been looking to make acquisitions since it received a $150 million investment from investor Brad Jacobs and his private equity firm in June 2011.
Jacobs, now the CEO of XPO, plans to transform the company into a $4 billion-$5 billion business in a few years, mostly through acquisitions.
The Turbo acquisition is XPO's biggest yet. It acquired Kelron for $8 million and Continental Freight for $3.4 million earlier this year.
The company is in talks with several other acquisition targets, most of them smaller than Turbo, Chief Executive Brad Jacobs told Reuters.
"There is a decent chance we will complete another acquisition by the end of the year," Jacobs said.
He also said the company is in talks for an asset-backed loan facility to give it more liquidity.
The company completed a stock and bond offering this year, prompting speculation among analysts that it was eyeing a large acquisition.
It will have cash of about $265 million after the Turbo acquisition, Jacobs said.
XPO's shares, which have risen about 50 percent since Jacobs invested in the company, closed at $12.63 on Thursday on the New York Stock Exchange.
(Reporting by A. Ananthalakshmi in Bangalore; Editing by Saumyadeb Chakrabarty)