TFI International (NYSE:TFII) has completed its $800 million acquisition of UPS Freight (NYSE:UPS), the Canadian trucking and logistics firm said Friday as it ushered in a new era as one of the largest less-than-truckload carriers in North America.
It came three months after TFI and UPS announced the deal in January. It allows UPS to jettison the largely unprofitable LTL and dedicated truckload operation while giving TFI its most ambitious turnaround projects to date.
TFI did not offer any new information about its plans for the future of the 6,300-truck and 14,500-employee operation — which includes 11,500 Teamsters union members. The LTL component, which makes up 90% of the transaction, becomes TFI’s newly named division TForce Freight.
It also makes TFI’s businesses overwhelmingly U.S. in origin. About 75% of the Canadian company’s revenue will come from the U.S., where it already has a substantial truckload operation and a growing logistics business.
TFI CEO Alain Bédard has told analysts that the Montreal-based company plans to aggressively bring down costs to make the operation “lean and mean.” Plans include renegotiating rates with shippers and leasing out former UPS Freight terminals.
UPS will continue to sell TFI’s services for at least five years under the terms of the deal.
Bédard hinted to analysts on Wednesday that the company is interested in deepening its collaboration with UPS beyond the acquisition.
“Don’t forget this discussion that we’re having with our friends in Atlanta,” Bédard said. “I think it may be way more than a transaction that we should be closing on soon.”
Bédard made the comments after TFI reported first-quarter financial results.