• DTS.USA
    5.820
    -0.005
    -0.1%
  • NTI.USA
    2.860
    0.000
    0%
  • NTID.USA
    2.840
    -0.060
    -2.1%
  • NTIDL.USA
    1.940
    -0.060
    -3%
  • OTRI.USA
    7.600
    -0.300
    -3.8%
  • OTVI.USA
    13,831.760
    901.630
    7%
  • DTS.USA
    5.820
    -0.005
    -0.1%
  • NTI.USA
    2.860
    0.000
    0%
  • NTID.USA
    2.840
    -0.060
    -2.1%
  • NTIDL.USA
    1.940
    -0.060
    -3%
  • OTRI.USA
    7.600
    -0.300
    -3.8%
  • OTVI.USA
    13,831.760
    901.630
    7%
BusinessNewsTop StoriesTrucking

XPO considering sale of freight forwarding business

Unit slated to be part of fourth-quarter spin-off, but plans may change

XPO Logistics Inc. is exploring the sale of its North American freight forwarding unit in a transaction that could be valued between $400 million to $600 million, according to a published report that was confirmed independently.

Bloomberg first reported the story late on Friday. FreightWaves subsequently received confirmation from people familiar with the matter.

The freight forwarding unit is part of a collection of four assets that XPO (NYSE: XPO) plans to spin off into a separate company during the fourth quarter. XPO’s truck brokerage division is the most prominent and profitable of the four. Besides freight forwarding, the others are final mile and managed transportation. 

The spinoff, combined with the eventual sale or listing of its European business and the late March sale of its North American intermodal operation for $710 million in cash to STG Logistics, will leave XPO as a pure-play LTL carrier. Last summer, it spun off its logistics business into what is now GXO Logistics Inc. (NYSE: GXO)

XPO doesn’t break out financial results for its freight forwarding business. The freight forwarding and managed transportation operations generated $551 million in revenue in the first quarter. The combined margin for the two companies was $166 million. XPO defines margin as gross revenue minus the cost of transportation and services, exclusive of depreciation and amortization.

The combined margin for XPO’s LTL and brokerage businesses was $594 million, about 60% of the $1.03 billion in total margin for the Greenwich, Connecticut-based company.

Read more

The FREIGHTWAVES TOP 500 For-Hire Carriers list includes XPO Logistics (No. 8).

Mark Solomon

Formerly the Executive Editor at DC Velocity, Mark Solomon joined FreightWaves as Managing Editor of Freight Markets. Solomon began his journalistic career in 1982 at Traffic World magazine, ran his own public relations firm (Media Based Solutions) from 1994 to 2008, and has been at DC Velocity since then. Over the course of his career, Solomon has covered nearly the whole gamut of the transportation and logistics industry, including trucking, railroads, maritime, 3PLs, and regulatory issues. Solomon witnessed and narrated the rise of Amazon and XPO Logistics and the shift of the U.S. Postal Service from a mail-focused service to parcel, as well as the exponential, e-commerce-driven growth of warehouse square footage and omnichannel fulfillment.

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