Only weeks after buying Con-way Inc. for $3 billion, XPO Logistics is already considering selling the truckload division.
XPO admitted in an email that they had several offers on the table, but they have not decided yet whether they want to sell. “It’s true we have received several unsolicited inbound calls from interested buyers but we haven’t decided,” said Chief Executive Bradley Jacobs.
While the truckload division is only 11% of Con-way’s total revenue, the division generates $632 million in revenue each year. However, profit margins have been slimmer for Con-way this year.
Con-way saw its revenue fall 11% in the first six months of 2015. It’s operating earnings have fallen 23% this year.
If XPO were to sell Con-way Truckload, it would more firmly establish them in the less-than-truckload sector. XPO is also looking at major changes for Conway’s LTL service, including adding a cheaper economy option to the more expensive premium distribution service.
Sources:
Marketwatch
Wall Street Journal
