- TFI International is acquiring "substantially all the assets" of Comcar subsidiaries MCT Transportation and CT Transportation, according to two press releases Monday. TFI paid $9.6 million for acquired MCT Transportation assets, including accounts receivable, and $2.8 million for two real estate properties. For CT Transportation, TFI paid $15 million.
- CT Transportation will become part of TFI's truckload segment and will change its name to Coastal Transport. MCT Transportation will also become a part of that segment, though TFI did not mention a name change.
- MCT Transportation offers reefer and dry van services, while CT Transportation was Comcar's flatbed arm. The former will allow Montreal-based TFI to expand its footprint in the Midwest. CT Transportation will give the company more access to the Mid-Atlantic. Both also serve the Southeast.
Companies shutting their doors present an opportunity for growing firms to expand through acquisition. In the first half of 2019, 640 carriers went out of business, more than double the number of closures in all of 2018.
TFI has been in a growth spurt. In 2019, it acquired Schilli and Aulick, expanding U.S. trucking operations. It closed its IPO in February, banking more than $230 million. On June 18, TFI announced it closed its acquisition of Canadian container transport and storage firm Gugso Transport.
PS Logistics has also been on an acquisition streak in the last few years, buying Celadon Logistics from Celadon Group in April 2019, when the Indianapolis-based TL carrier was in trouble. Celadon later filed Chapter 11 bankruptcy. Since the end of 2017, PS Logistics has acquired six companies.
When Comcar announced its Chapter 11 bankruptcy filing in May, PS Logistics was set to buy CT Transportation. But TFI subsidiary Bulk Transport Company East submitted a competing bid June 11, according to Delaware Bankruptcy Court documents dated June 23. Comcar filed to have an auction June 15, during which TFI outbid PS logistics, and a purchase agreement was signed June 18, according to the documents.
TFI has a strong customer overlap with MCT Transportation and CT Transportation, TFI CEO Alain Bédard said in a press release.
Experts don't see financial hardships for carriers ending any time soon, as the pandemic continues to affect the economy. The Council of Supply Chain Management Professionals' (CSCMP) State of Logistics Report said small- to medium-sized carriers without diverse customer portfolios will be the most negatively impacted.
"Whatever [recovery's] shape — 'V,' 'L' or 'swish' — we know that the bulk of the logistics in the U.S., where consumption is some 70% of GDP, is going to have to adapt." Michael Zimmerman, partner at Kearney, said during the report's presentation last week. "And that means further cutbacks by carriers and a rise in bankruptcies, at least in the short term."