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Roadrunner Sells Distribution Service to C.H. Robinson for $225 Million

Roadrunner Transportation Systems trailers

Roadrunner Transportation Systems

 

Roadrunner Transportation Systems Inc., a transportation and asset-light logistics provider, will sell its Prime Distribution Services business to C.H. Robinson Worldwide Inc. for $225 million in cash, according to a Jan. 28 news release.

The transaction is expected to close by the end of the first quarter.

Prime Distribution Services, headquartered in Plainfield, Ind., provides a suite of retail consolidation solutions, with five food-grade warehouse facilities nationwide. Roadrunner said it has a team of retail supply chain experts dedicated to helping clients comply with large U.S. retailer delivery and in-stock requirements.

The business, which had revenue of $108.7 million for the year ended Dec. 31, is part of the company’s Ascent Global Logistics segment.

“The divestiture of Prime Distribution Services is a unique opportunity for us to significantly improve our balance sheet,” Roadrunner CEO Curt Stoelting said. “We believe we are well-positioned to execute our strategy of simplifying our portfolio by investing in our remaining Ascent Global Logistics, Active On-Demand and asset-light less-than-truckload segments.”

Oppenheimer and Co. Inc. acted as financial adviser and Debevoise and Plimpton served as legal adviser to Roadrunner on the transaction.

Roadrunner is based in Downers Grove, Ill. Roadrunner ranks No. 17 on the Transport Topics Top 100 list of the largest for-hire carriers in North America.

Roadrunner has been attempting to adjust its business model after a 2017 accounting scandal and a softer freight market in 2019. The company also was hit by a malware attack in September and October that cost the company about $10 million.

In December, Roadrunner sold its flatbed business unit for $30 million in cash. It did not disclose the buyer. And on Nov. 5, Roadrunner announced it sold its intermodal business to Universal Logistics Holdings for $51.25 million in cash.

Based in Eden Prairie, Minn., C.H. Robinson said it has more than $20 billion in freight under management and 18 million shipments annually.

C.H. Robinson ranks No. 5 on the Transport Topics Top 50 list of the largest logistics companies in North America.

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