ArcBest buys up logistics business

ABF arm to run $25M acquisition

ABF Logistics, a subsidiary of Fort Smith- based ArcBest Corp., announced Friday that it has purchased Logistics & Distribution Services for $25 million.

Logistics & Distribution Services is a private logistics and distribution company based in Sparks, Nev., and has about 30 employees and about $60 million in annual revenue.

“This is consistent with a strategy that ArcBest has discussed over the last few years, which is to continue to try to grow the asset-light portfolio of their business to diversify the company’s earnings stream,” said Brad Delco, transport analyst at Stephens Inc. in Little Rock.

In 2015 the company announced a goal to increase its asset-light segments to almost half of its total business by 2018. Currently its asset-light subsidiaries — ABF Logistics, Panther Premium Logistics, FleetNet and ABF Moving — compose 30 percent of the corporation’s total business. ABF Freight, its less-than-truckload business, makes up the rest.

The deal involves $ 17 million in cash, with $ 8 million held in escrow to be “released upon achieve--

ment of certain financial targets over the next two years,” the news release specified.

Logistics & Distribution Services was founded in 2001 by Ross Kline, who remains president and chief executive officer. He will continue on as head of the existing Logistics & Distribution Services locations, in Nevada and Allentown, Pa., as they become ABF Logistics branches.

ABF Logistics has been looking for asset- light acquisitions and has acquired Oklahoma City-based Smart Lines Transportation Group in January 2015 and Bear Transportation Services of Plano, Texas, in December 2015.

ABF Logistics President Jim Ingram said in the release that the purchase “complements our business nicely by adding to our existing services, specifically in deploying dedicated capacity, which will increase the breadth of our available solutions for customers.”

“This acquisition seems to provide both geographic diversification

for [ArcBest]’s asset-light portfolio as well as some product diversification,” Delco said. He noted that Logistics & Distribution Services “seems to have a specialty niche product focused on providing dedicated trucking services using an asset-light model.”

“I’m very excited. We’ve been trying to put this deal together for a while,” Kline said. “I built this company from scratch, and I think it’s time for us to get involved with a larger company with larger resources. I think ArcBest is an awesome, awesome company, and I couldn’t speak more highly of them.”