Landstar Selling Supply Chain Business to XPO Logistics

Logistics and freight brokerage services provider XPO Logistics will buy the Michigan-based supply chain business of Florida-based Landstar System, including NLM, a provider of web-based expedited transportation management in North America, for $87 million.

NLM's proprietary online auction system allows carriers to bid on loads that are then awarded electronically, generating a transaction management fee for NLM. For the 12-month period through November 2013, NLM managed approximately $500 million in freight transportation transactions and generated $9.8 million in earnings.

“The addition of NLM, the largest web-based expediter in North America, will give us an entry into managed transportation, an area of logistics that has been of keen interest to us for some time,” said Bradley Jacobs, chairman and CEO of the Connecticut-based XPO Logistics. “We'll use NLM to build on our position as a top five expediter by providing customers with precise, web-based capabilities for the bidding, scheduling, shipping and tracking of freight. With the close of this transaction, we'll be facilitating more than 20,000 deliveries a day company-wide."

Landstar System is an asset-light provider of integrated transportation management solutions, including in trucking. Its supply chain operations were created by purchases in 2009 of Premier Logistics, which included National Logistics Management, along with buying Interactive Capacity Gateway and A3 Integration. 

After the closing of the sale of these companies to XPO, Landstar will maintain offices in the Southfield/Detroit area.

Henry Gerkens, Landstar chairman, president and CEO, says the company believes selling the business is appropriate because it is “better suited for a company store type operation rather than Landstar's core agent-based model."

"Landstar's overall strategy and focus will continue to include growing our core business model by investing in technological solutions and businesses that support and expand our agent, customer and third party capacity provider base," said Gerkens.