UPS to Acquire Menlo Worldwide Forwarding
UPS (NYSE: UPS) and CNF Inc. (NYSE: CNF) today announced UPS has agreed to acquire Menlo Worldwide Forwarding, Inc., a subsidiary of CNF, for US$150 million in cash and the assumption of approximately US$110 million in long-term debt.
Menlo Worldwide Forwarding is a global freight forwarder that provides a full suite of heavy air freight forwarding services, ocean services and international trade management, including customs brokerage. It had US$1.9 billion in gross revenues in 2003.
The acquisition reinforces UPS’s strategy of providing broad supply chain solutions to enable global commerce. As a result of the acquisition, UPS will expand its global capabilities and add guaranteed heavy air freight services around the world, enabling customers to reach the global marketplace faster. This also means UPS will introduce new time-definite products such as overnight, two-day and deferred heavy air freight in North America.
“This acquisition is an ideal strategic and operational fit,” said Bob Stoffel, UPS senior vice president, Supply Chain Group. “Menlo Worldwide Forwarding is a well-established global air freight forwarder, with international trade capabilities, all of which complement UPS’s existing operations.
“Customers want to streamline their supply chains. The expanded solutions UPS can provide will help customers simplify global trade by giving them more options for moving goods around the world and by providing a single point of accountability.”
Menlo Worldwide Forwarding currently operates in more than 175 countries and territories in the world. Menlo Worldwide Forwarding’s customers include some of the world’s most recognized brands across a broad range of industries, including pharmaceuticals, apparel, high tech/electronics, government, consumer goods and retail.
UPS expects to complete the transaction during the fourth quarter of 2004. The transaction is subject to customary closing conditions. The transaction is expected to be slightly accretive to earnings in 2005.
W. Keith Kennedy, CNF chairman and interim chief executive officer, said: “The divestiture serves the best interests of our shareholders while enabling Menlo Worldwide Forwarding to join with one of the premier brands in the transportation industry.”
UPS is the world’s largest package delivery company and a global leader in supply chain services, offering an extensive range of options for synchronizing the flow of goods, information and funds. UPS’s stock trades on the New York Stock Exchange (UPS) and the company can be found on the Web at ups.com.
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