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Mike Rosendahl

E: mrosendahl@pcecompanies.com

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Industry Trends

U.S. Airlines Struggle as Travel Returns to Pre-Pandemic Levels

Flight delays and cancellations increased in June as airlines and airports struggled to handle a surge of pent-up demand while facing pilot and aircrew shortages; the ripple effects from severe storms are also to blame. The third weekend of June experienced over 19,000 flight delays or cancellations as over 4.5 million people, a record number, passed through U.S. airport security lines on Friday and Saturday alone. Delays and cancellations are expected to continue to be unusually high throughout the summer and may not let up until next year.1

U.S. Lawmakers Move Towards Tougher Regulations on Ocean Carriers

U.S. lawmakers are working to pass an overhaul of maritime rules in the coming months to strengthen oversight of international shipping companies. Lawmakers intend the bill to curb inflation by limiting fees paid by shipping customers and making it more difficult for shippers to turn down export shipments. Those who oppose the bill warn of unintended consequences. Fortunately for shipping customers, freight rates and the logjam of ships in port have been decreasing in recent months.2

U.S. Court Approves Chapter 11 Restructuring of LATAM Airlines Group

Pandemic restrictions drove LATAM Airlines to file for U.S. bankruptcy protection. Now, after two years of negotiation between LATAM and its stakeholders, A New York judge approved a chapter 11 restructuring plan. The plan will include $5.44 billion in capital for the company through capital raises backstopped by major unsecured creditors and guarantees from shareholders, Delta Airlines and Qatar airways. The company’s chapter 11 process may face additional hurdles from Chilean courts and regulators but is expected to be completed by the end of the year.3

DB Schenker to buy USA Truck

DB Schenker has agreed to pay $31.72 per share for USA Truck, Inc. in a transaction that is expected to close before the end of the year. Consideration to shareholders is approximately $285MM, and includes debt and cash for a total deal value of $435MM or about five times annual EBITDA. According to Jochen Thewes, chief executive of DB Shenker, the deal furthers the company’s “strategic ambition to expand our network in North America and foster our positions as a leading global logistics provider”.4

Largest Transactions Closed

  • Target
  • Buyer
  • Value($mm)
  • Pilot - A Maersk Company
  • A.P. Møller - Mærsk A/S
  • $1,800.00
  • Concessionaire for the new Terminal 1 at JFK International Airport in New York City
  • Ferrovial, S.A.
  • $1,140.00
  • Kane Logistics, Inc.
  • ID Logistics Group SA
  • $240.00
  • Smith Transport, Inc.
  • Heartland Express, Inc.
  • $170.00
  • Aries Global Logistics, Inc.
  • NTG Nordic Transport Group A/S
  • $105.00

Other Financial Buyer Transactions Closed

  • Target
  • Buyer
  • Value($mm)
  • Arrow Waste
  • Carr's Hill Partners, LLC
  • n/a
  • iDC Logistics Inc.
  • H.I.G. Capital, LLC
  • n/a
  • El Paso, TX Location of Fleet Trailer Leasing, LLC
  • Boxwheel Trailer Leasing LLC
  • n/a

Other Strategic Buyer Transactions Closed

  • Target
  • Buyer
  • Value($mm)
  • Pan Am Railways, Inc.
  • CSX Corporation
  • $30.00
  • Assets of PeriShip, LLC
  • VerifyMe, Inc.
  • $10.47
  • The Import Export Group, Inc.
  • Universal Power Industry Corporation
  • $2.10
  • Substantially All Assets of Shyp FX, Inc.
  • Farhoud Logistics Inc.
  • $0.75
  • Blue Star Bus Sales, Ltd
  • A-Z Bus Sales, Inc.
  • n/a

 

Source S&P Capital IQ as of 7/8/2022 and PCE Proprietary Data

PCE Transactions

Contacts

Michael Rosendahl

New York Office

201-444-6280 Ext 1 |

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Michael Poole

Orlando Office

407-621-2112 |

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Data Assumptions

This report represents transaction activity as mergers & acquisitions, consolidations, restructurings and spin-offs. Targets are defined as U.S. Based companies with either foreign or U.S. based buyers. Transaction information provided is based on closed dates only.

Glossary

EBIT - Earnings Before Interest and Taxes
EBITDA - Earnings Before Interest, Taxes, Depreciation, Amortization
LTM - Last Twelve Months
TEV - Total Enterprise Value

Sources:

  1. Mendoza, Jordan, and Thao Nguyen. “'Travel Armageddon' as Flight Delays, Cancellations Pile up: What's Going on?” USA Today, Gannett Satellite Information Network, 21 June 2022.
  2. Berger, Paul. “Biden Blasts Ocean Carriers as Congress Readies Tougher Shipping Regulations.” The Wall Street Journal, Dow Jones & Company, 10 June 2022.
  3. Matsuda, Akiko. “LATAM Airlines Cleared to Depart Chapter 11 under Creditors' Control.” The Wall Street Journal, Dow Jones & Company, 19 June 2022.
  4. Feuer, Will. “Logistics Provider DB Schenker to Buy USA Truck for about $285 Million.” The Wall Street Journal, Dow Jones & Company, 24 June 2022.
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