UPDATED — The trucking company Quality Distribution Inc. has reached an agreement to be acquired by the private investment fund Apax Partners.
The purchase price is approximately $800 million, including the assumption of debt, or $16 per share, for the Florida-based operation.
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The transaction price represents a premium of approximately 63% over Quality Distribution's closing share price on Wednesday.
Under the terms of the agreement, Quality Distribution may solicit alternative proposals from third parties during a 40-day "go-shop" period.
Quality Distribution’s board of directors, which recommended that shareholders approve the deal, has unanimously approved the agreement. If this happens, and is also approved by federal regulators, it is expected to close in the third quarter of the year.
"We believe our sale to Apax maximizes value for our shareholders and provides Quality Distribution with the increased financial flexibility we need to continue to grow," said Gary Enzor, chairman and CEO of Quality Distribution. "Apax supports our strategy and is committed to helping us continue our pursuit of strategic growth in our chemical and intermodal businesses while managing the current market conditions in the energy industry."
Quality Distribution operates one the largest chemical bulk logistics networks in North America through Quality Carriers Inc., and provides intermodal tank container and depot services through Boasso America Corp. Quality also provides logistics and transportation services to the unconventional oil and gas industry through QC Energy Resources Inc.
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Quality Distribution has also reported first quarter earnings showing net income of $2.5 million, or 9 cents per diluted share, compared to $3.1 million, 11 cents per diluted share, a year earlier.
Total revenue was $230.4 million in the most recent quarter compared to $234.5 million a year earlier. Excluding fuel surcharges, revenue increased to $207.3 million, compared to $201.7 million.
This improvement was primarily due to the 2014 expansion efforts in its chemical logistics business, which drove increased volumes, along with strong growth in the intermodal business, specifically depot services, according to the company. This was partially offset by adverse weather conditions and the exit of Quality’s energy logistics from certain underperforming shale regions.
"I am pleased with our overall financial performance this quarter, which led to solid profitability that exceeded our expectations," said Enzor. "All three segments were impacted by adverse weather conditions in the first quarter, but chemical's and intermodal's increased revenues helped drive bottom line profitability."
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