Forward Air announced two acquisitions on Wednesday aimed at bolstering its intermodal transportation unit. The company acquired BarOle Trucking, the biggest intermodal carrier in Minnesota’s Twin Cities area as well as the trucking assets of TKI Intermodal, a Minneapolis-based provider of container drayage and storage.
The deals are expected to add $25 million in revenue and boost Forward’s intermodal presence in the Minneapolis market by four times.
Forward (NASDAQ: FWRD) also adds 95 drivers and additional storage yards and chassis in the transactions. BarOle is listed as having 86 power units registered, according to the Federal Motor Carrier Safety Administration. TKI has 14.
Greeneville, Tennessee-based Forward said it may consolidate its Minnesota operations into one location, although it doesn’t see any “employment redundancies.” The press release said, “Newly acquired team members will have significant opportunity for career progression within the greater Forward business.”
Financial terms of the transactions were not provided. TKI was acquired by Forward in October and the BarOle deal is expected to close in December.
“The trucking and logistics industry is under unprecedented pressure, especially within the intermodal market, as we have seen higher demand than normal,” said Tom Schmitt, chairman and CEO of Forward. “The acquisitions are a continuation of our business strategy, empowering us with the additional resources necessary to meet growing customer demand while driving efficiency, market expansion and industry-leading career opportunities.”
Asset-light trucking- and logistics-centric Forward has made several acquisitions in recent years across all of its major businesses – less-than-truckload, final mile and intermodal. The company began rolling up intermodal operators in 2014, acquiring Central States Trucking for approximately $95 million.
However, the company continues to focus on its core LTL offering to drive margins higher.
For the better part of this year, Forward has been upgrading its customer book to include shippers with freight that better matches its network. Those initiatives were highlighted in its third-quarter earnings report, which showed significant revenue growth even though volumes were down. Improved yield and weight per shipment led to better margins and record earnings.
“Our primary focus is to pursue accretive acquisitions that complement or expand the Expedited LTL division, while continuing to grow our intermodal segment with strategic acquisitions,” the press release stated.