- Canada-based GTI Transport Solutions announced Thursday it purchased Foxconn Logistics, a transport provider that specializes in drayage and container management.
- The acquisition of the Nashville, Tennessee-based non-asset brokerage strengthens subsidiary GTI USA's intermodal expertise and furthers the company's plans to focus more on the north-south corridor between Montreal and Texas.
- ''The intricacies of container and transportation management can be complex for our clients," said Kent Jordan, president of GTI USA. "Foxconn's integration into GTI USA enhances our managed transportation services offering and provides increased value to customers.''
It's expected to be another busy year for M&A in the trucking industry — and logistics firms like Foxconn aren't alone in being eyed by bigger companies.
With many large companies flush with cash, higher-margin LTL firms could be gobbled up, experts say.
Knight-Swift Transportation, for instance, is "poised to continue making investments," President and CEO Dave Jackson said during a Q1 earnings call. "We would love to grow an LTL."
Consolidation in the trucking industry reflects a broader boom in M&A across industries last year — which shows no signs of slowing.
Transaction levels will remain robust in 2022 because companies "need to remain on the offense with the competition" and "feel pressure from investors to raise their own valuations," according to a KPMG survey of U.S. corporate deal-makers in December.
For GTI, the Foxconn acquisition is meant to augment the company's service offerings in the U.S., particularly around managed transportation, container management, drayage and contract brokering.
The terms of the deal were not disclosed.
Richard Lafrenière, president and CEO at GTI, said Foxconn's list of blue-chip clients in the U.S., along with its culture of performance and growth, made it attractive. It's the company's fourth acquisition in as many years. GTI acquired Canada-based Precision Specialized and entered the U.S. market by purchasing Texas-based Jetco in 2019.
"This partnership will allow GTI to complement the current service offering to Foxconn's customers," Lafrenière said. "Similarly, GTI's customers will benefit from Foxconn's expertise in container transportation which can be greatly leveraged in the current environment."
Vincent Burch, Foxconn co-founder, said GTI will provide more resources to support Foxconn's employees, "who have established deep relationships with our customers."
"Today, we can quickly gain a larger share of wallet by offering a complete value-added solution for all their freight and logistics needs," Burch said.