XPO Logistics raising funds for Norbert Dentressangle purchase

XPO Logistics has entered into definitive agreements with a group of global institutional investors to raise a total of $1.26 billion of equity, which it will use to fund its ongoing growth strategy. As previously reported by Post&Parcel, XPO Logistics announced in May that it intends to buy Norbert Dentressangle SA and some other, unspecified acquisitions are also in the pipeline.

The group of investors includes Ontario Teachers’ Pension Plan, GIC – Singapore’s sovereign wealth fund – and Public Sector Pension Investment Board, which collectively made an initial investment of $700 million in the company in September 2014. These three global investors each increased their holdings in XPO with the new private placement and were joined by 12 institutional investors, including sovereign and university endowment funds.

In a statement issued on Monday (1 June), XPO Logistics commented: “The transaction, which is complete and scheduled to settle this week, provides for the sale of newly issued common stock and preferred stock to the investors at a price of $45 per share of common stock on an as-converted basis. Upon approval by the company’s shareholders, the preferred stock will be converted into common stock.”

In a separate but related statement also issued on Monday, XPO said that it additionally intends to raise more funds by issuing $2.0 billion U.S. dollar equivalent of senior notes. According to XPO: “The Notes are expected to be issued in up to four tranches that may include U.S. dollar-denominated senior notes due in 2022, euro-denominated fixed rate senior notes due 2021, euro-denominated floating rate senior notes due in 2020, and pounds sterling-denominated senior notes due in 2020.”