UPS sells Coyote Logistics to RXO for $1bn in cash

UPS announced today it has agreed to sell its Coyote Logistics truckload brokerage unit to RXO for $1.025bn.

“As UPS positions itself to become the premium small package provider and logistics partner in the world, the decision to sell our Coyote Logistics business allows an even greater focus on our core business,” said UPS CEO Carol Tomé in prepared remarks.

The acquisition, RXO said, will enhance its “market position, diversify and expand its customer base, and broaden its carrier network. At closing, RXO will be the third-largest provider of brokered transportation in North America”.

“RXO’s highly accretive acquisition of Coyote will immediately increase the scale of our brokerage business, providing customers with more capacity across a wider array of power lanes,” said CEO Drew Wilkerson in prepared remarks.

Annualised cost synergies: at least $25m.

Deal expected to be “immediately and significantly accretive to RXO’s adjusted diluted earnings per share and adjusted free cash flow”.

The full statement from UPS is here, while RXO’s disclosure is here – out on DeskOne first.