YRC sells off part of its 3PL unit
Greatwide Logistics buys contract carriage business of YRC Logistics services
Dave Hannon -- Purchasing, 11/24/2009 2:57:55 PM
Troubled trucking firm YRC Worldwide this week sold off the dedicated contract carriage division of its YRC Logistics division to third-party logistics provider Greatwide Logistics Services for $34 million.
While it's another step towards streamlining its business, the business sold only represents about 1% of YRC's total business. Greatwide is a 3PL focused on dedicated contract carriage and is owned by Centerbridge Partners. YRC Logistics is a wholly owned subsidiary of LTL trucker YRC Worldwide.
"This sale is a strategic move toward a more asset-light business model and aligns resources at YRC Logistics to focus on our core offerings, including transportation, distribution and global services," says John Carr, president of YRC Logistics in a statement.
In a note to clients this morning, Longbow Research estimates that YRC Logistics' dedicated contract carriage business accounted for roughly 15% of YRC Logistics' revenue and about 1% of YRC's total. "The company has said they are looking to move YRC Logistics to a purely asset-light model, but we expect that cash generation, improvement to the balance sheet and liquidity were the driving factors in the deal. YRC continues to be aggressive in rightsizing its network to current demand levels, reducing its cost structure, and monetizing its assets through excess property sales and sale-leasebacks."
Also see: Trucking market shifts into next cycle a deep-dive look at the trucking market.
YRC's future the topic of much debate
02/09/2010LTL market outlook remains unclear
02/09/2010YRC Logistics expands in China
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02/09/2010YRC Expands In China
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