Phoenix-based truckload carrier Knight Transportation, has responded to USA Truck’s recent rejection of its purchase offer.
“We are disappointed that USA Truck has once again rejected Knight’s all-cash, premium proposal ($9.00 per share, all-cash). Since making our proposal public, we have had discussions with several of USA Truck’s largest shareholders that have indicated their support for our proposal and have encouraged us to continue to take the necessary steps to acquire USA Truck,” the company said in a statement issued on Monday. “We continue to believe that a combination of Knight and USA Truck is better positioned to deliver value for and is in the best interest of all of Knight and USA Truck’s stakeholders, and we are prepared to take the necessary steps to make this combination a reality.”
Knight also announced that it has filed with the U.S. Securities and Exchange Commission an increased ownership position of 1,192,364 shares of USA Truck common stock, representing approximately 11.3% of USA Truck’s shares outstanding.
Knight announced on September 26 it proposed to acquire all of USA Truck for approximately $242 million, including USA Truck’s approximately $147 million of outstanding net indebtedness. It says the proposal represents a significant premium of approximately 39% to USA Truck’s closing price on September 25, the last trading day prior to public announcement of Knight’s proposal
Late last week USA Truck released a statement saying its board of directors "had previously reviewed Knight Transportation's unsolicited proposal with USA Truck's management team and financial and legal advisors, and unanimously concluded that the proposal substantially undervalues USA Truck and is not in the best interests of USA Truck and its shareholders.
Knight's earlier announcement noted that Knight and USA Truck operate in complementary service lines, and said such a deal would create "an operationally and financially stronger transportation company that is better positioned to deliver value for all of our stakeholders."
USA Truck, based in Van Buren, Ark., is in the midst of a turnaround effort. It hasn't reported an annual profit since 2008.
In 2011, USA Truck rejected a takeover offer by Celadon Group of Indianapolis.