XPO | XPO Logistics Appoints Tony Brooks As President Of LTL Business

Roadway stock was around 22 dollars when Yellow offered to buy them. Yellow paid 46 per share to shareholders.[/QU
Your entitled to your opinion, but not your own facts.....

Shareholders did not seem to embrace that idea. Yellow's shares dropped $1.24, to $23.25 yesterday. Shares of Roadway soared by $16.08, to $46.10. The stock is now ''in the hands of the arbitragers,'' said Charles L. Hill, director of research at Thomson First Call.


No. 2 in Trucking, Yellow, Will Buy No. 1, Roadway
By CLAUDIA H. DEUTSCH
Published: July 9, 2003

The Yellow Corporation, the nation's second-largest trucking company, will acquire the industry leader, the Roadway Corporation, the two companies said yesterday. The deal will create the Yellow-Roadway Corporation, a behemoth with more than $6 billion in annual sales.

Financial analysts hailed the deal as bringing needed consolidation to an industry that has been struggling to stay profitable. The weak economy has reduced the amount of freight carried on trucks even as many shippers have embraced just-in-time inventory practices that let them send smaller loads, often through rail-and-ship combinations and other alternatives.

Still, the deal's price and the new company's structure had analysts scratching their heads.

Yellow agreed to pay $966 million, or about $48 a share, for Roadway, whose stock closed on Monday at just $30.02. Moreover, William D. Zollars, the chairman of Yellow who will head the new company, insisted the two would continue to operate separately. Roadway will keep its offices in Akron, Ohio, even though the combined company will be based at Yellow's headquarters in Overland Park, Kan. Each will keep its network of more than 300 terminals where trucks are loaded.

''This industry has too many terminals, too many trucks, too much capacity,'' said Gregory E. Burns, a transportation analyst at J. P. Morgan. ''They have to look at overlapping operations and cut capacity.''

Mr. Zollars took a different view. In an interview, he conceded that some operations might eventually have to be consolidated, but for the next year or two, he said, he is happy to avoid the pains of integrating companies.

''This acquisition is not about shrinking,'' he said. ''It is about growing the customer base and services we sell. So why slam these companies together and hope for the best?''

Shareholders did not seem to embrace that idea. Yellow's shares dropped $1.24, to $23.25 yesterday. Shares of Roadway soared by $16.08, to $46.10. The stock is now ''in the hands of the arbitragers,'' said Charles L. Hill, director of research at Thomson First Call.

It may also be in the Justice Department's hands. Consolidated Freightways, which was the third-largest trucking company, closed 10 months ago. Though there are many regional trucking companies, and trucking divisions of other transportation companies, Consolidated's demise left U.S. Freightways, Yellow and Roadway as the only independent national long-haul trucking companies.

''The companies' lawyers will say the industry must consolidate to survive, but the Justice Department may still believe that the companies will not be aggressively competitive,'' said John C. Christie Jr., co-chairman of the antitrust practice at Hale & Dorr, a Washington law firm.

Gina Talamona, a spokeswoman for the Justice Department, said simply, ''We are aware of the deal and we will review it.''

About 70 percent of Yellow's business is hauling goods for manufacturers, with 30 percent from retailers. Roadway's customers are evenly split between manufacturers and retailers. Edward M. Wolfe, an analyst with Bear, Stearns, estimated that the combined company would have 58 percent of the total market for long-haul shipments of loads that are less than a full truckload.

Mr. Zollars and James D. Staley, Roadway's chief executive, said antitrust concerns were overblown. ''Sure, we both carry retailers,'' said Mr. Staley, who will stay on as Roadway's top executive, ''but we're strong with Home Depot, they're strong with Lowe's. They're strong with Wal-Mart, and we're not.''

Mr. Zollars said that the combined company would still represent only 1 percent of a $600 billion global freight-transportation market. He noted that truckers, sea-freight companies and airlines all make alliances for long-distance shipping. Moreover, big trucking companies now try to handle international shipments, same-day and overnight deliveries, and even small parcels, to offer customers one-stop shopping. Yellow offers to manage a customer's freight-handling operation through a subsidiary called Meridian IQ. ''Customers want us to do many more things, so that old fragmentation of the market has pretty much disappeared,'' Mr. Zollars said.

The merger will, of course, change the companies. Mr. Zollars estimated that by combining back office operations, the combined company would save as much as $45 million in the first year and as much as $125 million a year after five years. And he said he expected Yellow to be able to sell its Meridian management services to Roadway customers. Roadway had been buying up regional trucking companies, a strategy that Mr. Zollars said Yellow had tried and abandoned and would not resume.

Although Mr. Zollars insisted that, for now, Roadway and Yellow sales forces would continue to bid against each other for customers, he did not insist that practice would continue forever. ''Hypothetically, we could focus on different industry groups, or different geographies,'' he said.

The deal is bittersweet for Mr. Staley, 53, who has been at Roadway's helm less than a year. In June, the company's stock plunged as he warned analysts that despite a one-time increase in business after Consolidated's closing, Roadway's second-quarter earnings would be much lower than predicted.

Yesterday, after the conference call announcing the acquisition, Roadway confirmed the accuracy of that lowered estimate: revenues rose 13 percent from the quarter a year earlier, and income from continuing operations increased 43 percent. Roadway also predicted that revenues and earnings would rise significantly in the third quarter.

It would have been a nice time to be chief executive, but Mr. Zollars, at 56, is unlikely to retire soon. ''I'd be remiss if I didn't admit that it will be difficult to not be C.E.O. anymore,'' Mr. Staley said, ''but I will stay on to make sure Roadway employees get what they need.''

He will not be the only one watching that. Mr. Zollars and Mr. Staley will meet at noon today with James P. Hoffa, president of the Teamsters, which represents employees at both companies. The Teamsters just signed a five-year contract with both companies, and Bret Caldwell, a union spokesman, said the members were for the most part pleased with the contracts. But 15,000 of them lost their jobs when Consolidated closed, and the memory is fresh.

''These are two strong companies and we want to see them thrive,'' he said. ''Still, we're always concerned when there's a major transition at a unionized carrier.''

Photo: William D. Zollars, left, of the Yellow Corporation and James D. Staley of Roadway spoke to reporters yesterday from a Manhattan hotel room. (Bloomberg News)(pg. C8)
 
Mr. Brooks issued an email introducing himself to the XPO Logistics family. He highlighted his start as a driver , his roots in LTL , and his optimism toward the future. Mentioned technology playing a big part in XPO going forward.

His email was printed out and posted in our breakroom. At the end of Mr. Brooks letter he said feel free to email him - except on the printout placed in our breakroom his email address was left out , missing.

Hopefully , it's the same format ( first name.last [email protected] ) I wonder if local management left out the email address intentionally?
 
Mr. Brooks issued an email introducing himself to the XPO Logistics family. He highlighted his start as a driver , his roots in LTL , and his optimism toward the future. Mentioned technology playing a big part in XPO going forward.

His email was printed out and posted in our breakroom. At the end of Mr. Brooks letter he said feel free to email him - except on the printout placed in our breakroom his email address was left out , missing.

Hopefully , it's the same format ( first name.last [email protected] ) I wonder if local management left out the email address intentionally?

I honestly wouldn't mind emailing him a few things from an anonymous account.
 
Mr. Brooks issued an email introducing himself to the XPO Logistics family. He highlighted his start as a driver , his roots in LTL , and his optimism toward the future. Mentioned technology playing a big part in XPO going forward.

His email was printed out and posted in our breakroom. At the end of Mr. Brooks letter he said feel free to email him - except on the printout placed in our breakroom his email address was left out , missing.

Hopefully , it's the same format ( first name.last [email protected] ) I wonder if local management left out the email address intentionally?


We haven't seen this e-mail. The company kiss asses with corporate e-mail accounts don't share information with the rest of us ignorant useless truck drivers that ACTUALLY use our CDLs.
 
Mr. Brooks issued an email introducing himself to the XPO Logistics family. He highlighted his start as a driver , his roots in LTL , and his optimism toward the future. Mentioned technology playing a big part in XPO going forward.

His email was printed out and posted in our breakroom. At the end of Mr. Brooks letter he said feel free to email him - except on the printout placed in our breakroom his email address was left out , missing.

Hopefully , it's the same format ( first name.last [email protected] ) I wonder if local management left out the email address intentionally?
Can u snap a pic of this Brooks e=mail and post it? I'd love to read for myself what this guy's bio is. Also we don't have this e-mail at our facility and I'd like to share it with my fellow employees here. Thx!!!
 
Can u snap a pic of this Brooks e=mail and post it? I'd love to read for myself what this guy's bio is. Also we don't have this e-mail at our facility and I'd like to share it with my fellow employees here. Thx!!!

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Pretty solid letter. Should have been posted for everyone to see. Almost a month in. Any news would be good news.
 
We could run Dayton, Ohio. That would be awesome. I'd drive there, my dad could pick me up and I'd sleep at his house. We would both love it.
Speaking of which , Tony Brooks was in XDY and XCN this week.

He wants XPO to be number one. Yeah. Let's go. Right now XPO is number 2. In more than one way , according to Tony Brooks.
 
Yes , exactly. Reportedly , he said EOBRs will be up and running by end of year. He said he didn't know when P&D would be paperless.
The EOBRS have to be up and running by the end of the year per federal law. I heard some barns are using it now, ie beta testing.
 
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