TFI International Inc. is making a purchase of UPS Freight in an $800 million deal. UPS, just like most companies, faced some challenges that have led to the sale. Some of the compelling reasons included gaining a better strategic business position and settling debts. The sale was entirely based on improving the business.
LTL expected to be carried independently
UPS Freight’s less-than-truckload operations are expected to be carried out independently within TFI’s LTL business segment with a new name, TForce Freight. Truckload assets are to join the TFI’s truckload business segment. And in a report released by TFI, UPS Freight accrued about $3 billion in terms of revenue in the previous year.
Alain Bédard, CEO of TFI International, stated that they were pleased to announce the strategic acquisition they had made. Bédard reiterated that the purchase would not only improve service delivery to their customer but also their relationship with UPS. In addition, the CEO insisted that they intend to operate towards UPS Freight’s strengths by enforcing independent business units for accountability.
TFI International Inc. Buys UPS Freight TForce Freight will continue to ensure UPS’ distribution needs are addressed. Also, UPS will offer freight volumes inclusive of other services as TForce provides strategic network opportunities on the Canadian market. Furthermore, the move to acquire UPS is aimed at improving TForce Freight's ability to create value on a long-term scale and be more productive and efficient. UPS decided to make the sale after a thorough assessment of their portfolio. So they can be in a better strategic business position and pay their long-term debts.
In conclusion, UPS CEO Carol Tomé stated that the agreement with TFI International would allow UPS to be more customer-centered. The transaction is expected to be completed in the second quarter after regulatory approvals, and customary closing procedures are done. UPS Freight has 14,500 employees who are expected to go with TFI. Also, it's important to state that the transaction is not expected to affect the customers at all.
