TORONTO, Oct. 7, 2013 (GLOBE NEWSWIRE) -- Vitran Corporation Inc. ("Vitran" or the "Company") (VTNC) (VTN.TO) announced today that it has completed the previously announced sale of its U.S. LTL business to a company owned by industry veteran Matthew Moroun. Mr. Moroun is associated with a number of transportation companies whose interests include LTL, TL, Flatbed, Third Party Logistics and Warehousing.
Under the sale transaction, the purchaser acquired 100% of the common stock of the wholly-owned U.S. subsidiary which operates Vitran's U.S. LTL business.
In order to complete the transaction, Vitran capitalized the U.S. LTL business with the net amount of USD $3 million, after deducting the USD $2 million purchase price received by Vitran from the purchaser. In addition, the purchaser funded a cash deficit of approximately USD $1.4 million in the U.S. LTL business between September 23, 2013 and closing.
Vitran amended its senior revolving credit agreement to reduce the borrowing capacity to USD $26.3 million, which is the amount of the letters of credit currently outstanding for the U.S. LTL business. As part of the sale transaction, the obligations under the letters of credit remain guaranteed by the Company's Canadian LTL business. However, the purchaser will reduce such letters of credit to zero within the next 90 days.
William S. Deluce, Vitran's Interim President and Chief Executive Officer stated, "We believe the sale of our U.S. LTL business gives our employees and customers the best chance to prosper while also preserving value for all of Vitran's stakeholders. With the completion of this transaction, Vitran is now able to focus all of its attention and resources on its Canadian LTL business."
"Vitran's board of directors, in accordance with the exercise of its fiduciary obligations, and with the assistance of its financial and legal advisors, will continue to pursue a course of action that it believes is in the best interest of Vitran and its stakeholders," also stated Mr. Deluce.
Stephens Inc. acted as exclusive financial advisor, and McMillan LLP acted as legal counsel, to Vitran in connection with this transaction.