Latest news with #freight
Yahoo
5 hours ago
- Business
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Convoy Finds New Home: DAT Acquires Flexport's Freight-Matching Tech
Flexport is flipping the Convoy platform to truckload freight marketplace operator DAT Freight & Analytics nearly two years after acquiring the freight-matching service. DAT Freight & Analytics will integrate the platform within its DAT One service. DAT One is a subscription-based load board where nearly 700,000 loads are posted daily. More from Sourcing Journal CMA CGM Watching Hutchison Port Sale 'Very Closely' As Potential Suitor Union Pacific Hopes to Win Back Volume in Proposed $85B Norfolk Southern Deal UP-Norfolk Southern Merger Would Control Nearly Half of US Rail Container Traffic Convoy is designed to match shippers with trucking carriers, helping them save money on the process while the carriers get easier access to cargo to transport. Truckers who use the platform could find work without having to go through third-party brokers via emails and phone calls. Nearly 30,000 carriers—primarily owner-operators and small trucking companies—use Convoy to find loads, manage paperwork, receive payments and more. Under DAT's portfolio, Convoy will allow trucking brokers to access both automated and hands-on freight-matching options, supported by the marketplace operator's scale and reach, which has a database exceeding $1 trillion in total freight transactions. Neither party confirmed the financial terms of the sale. 'The acquisition of Convoy demonstrates DAT's ongoing commitment to enhancing network value for our customers,' said Jeff Clementz, DAT president and CEO in a statement. 'Together, we will give customers a better, broader freight-matching network, the ability to manage more loads and capture incrementally more business, and ultimately more choice.' After the deal was announced Monday, Flexport CEO and founder Ryan Petersen called the move a 'win-win-win' for all parties involved, saying the investment 'paid off.' 'When we acquired the Convoy Platform in November 2023, our goal was to preserve an important piece of logistics technology that was on the verge of disappearing. Over the past 18 months, we rebuilt and relaunched the platform as a neutral digital freight execution layer that serves brokers, carriers, and shippers across the market,' Petersen said. 'We brought tens of thousands of high-quality carriers back onto the platform, reignited broker adoption, and proved that this technology has tremendous value and potential.' According to Petersen, Convoy needed to be a neutral infrastructure layer that integrates shippers, brokers and carriers. But the platform itself couldn't be seen as a neutral technology in the industry if it was owned by Flexport, which itself is a freight forwarder, said Petersen. Flexport will keep the digital brokerage business it first acquired in the Convoy acquisition. Convoy had shut down in October 2023 days before selling its technology stack to Flexport, in what had been a rough period for freight tech companies that had struggled to pull in revenue during the start of the freight recession in 2022. While Convoy had at one point been valued at $3.8 billion after raising $260 million in April that year, venture capital funding and M&A deals had dried up during the period of elevated interest rates and lower freight demand. Flexport resurrected the platform in February 2024, giving its customers and legacy Convoy shippers access to the app. Later that year, the platform was extended to brokers. Brokers can use the platform to maximize reach and effectiveness of carrier operations teams and automate manual tasks, including carrier negotiation, vetting, status updates and document management. Convoy's features extend beyond its freight-matching marketplace in areas including fraud protection and payments. The platform's proprietary technology uses machine learning and AI models to verify carriers on the network and block malicious actors. These advanced security features can ideally help brokers reduce their risk of fraud and access a network of carrier capacity, all while increasing their efficiency and growing their business. Every carrier on the Convoy platform is eligible to get paid via payment service provider QuickPay. The service is available on every load on the platform, providing another option for fast payouts to carriers. DAT's Convoy purchase complements its slew of services including freight data analytics service DAT iQ, as well as two recently acquired technologies, load visibility provider Trucker Tools and freight financial services platform Outgo. The Convoy platform's engineers, product experts, and operations professionals will continue to be led by Bill Driegert, who will join DAT's executive leadership team. Driegert served as the executive vice president and head of trucking at Flexport, leading the team ahead of the Convoy acquisition as the company sought to build out its trucking services. Dreigert also previously headed operations at Uber Freight. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
7 hours ago
- Business
- Yahoo
While shippers cite merger concerns, rival railroad looks instead to ‘collaborations'
Canadian National this week was the only Class I railroad to publicly comment on the $85-billion acquisition agreement between Union Pacific and Norfolk Southern, a corporate marriage that if approved would create the first U.S. transcontinental freight railroad. 'CN is closely monitoring the ongoing discussions about possible transcontinental rail mergers,' the Montreal-based company (NYSE: CNI) said in a statement to FreightWaves. 'Our focus remains on delivering consistent performance for our customers, pursuing strategic growth opportunities, and creating long-term value for our shareholders. 'CN believes this can be achieved through greater collaboration between railways, connecting key markets with critical resources,' as opposed to mergers. The other Canadian transcon, CPKC (NYSE: CP), as well as BNSF and CSX (NASDAQ: CSX) in the U.S., declined to comment. In 2021 CN saw its own consolidation proposal with Kansas City Southern end in termination amid tougher U.S. merger rules. KCS eventually merged with Canadian Pacific in 2023. CN is an interchange partner with both UP (NYSE: UNP) and NS (NYSE: NSC), and is a partner in the UP-run EMP container program. CN also participates in UP's Falcon Premium intermodal service with GMXT connecting Mexico, the U.S., and Canada. One shippers group reiterated its opposition to the merger announcement Tuesday that would create an integrated network stretching from New Jersey to Southern California. 'American Chemistry Council (ACC) and its member companies have serious concerns about the negative impacts on American manufacturing from further consolidation in the freight rail industry,' the trade group said in a statement. 'We are closely watching the proposed terms of the deal and will actively oppose any merger that fails to significantly enhance competition between railroads. 'Our industry is one of the largest users of the U.S. freight rail system, and we need efficient and reliable service to deliver products that make people's lives better, healthier, and safer. 'The four largest freight railroads already control more than 90% of U.S. rail traffic, with two dominating in the eastern U.S. and two dominating in the west. The impact of a transcontinental merger between two of these railroads threatens to leave American manufacturers, farmers and energy producers with even fewer competitive options to ship by rail. 'Many rail customers are currently dealing with high rates and unreliable service. Further consolidation within the rail industry is likely to make these problems worse. 'Producing and moving more chemistry here at home is key to growing the economy. From microchips to cars to medicines, if we want to make more things in America and lead in global trade, we must do a better job transporting American made goods. We call on policymakers to help create more competitive and reliable transportation options, not less.' U.S. Sens. Roger Marshall (R-Kan.) and Tammy Baldwin (D-Wis.) in a letter urged the Surface Transportation Board to 'keep the best interests of rail shippers and consumers in mind' during the board's upcoming review of the merger, expressing concerns about the merger's impact in a letter to board members. Meanwhile, Nebraska Republican senators Deb Fischer and Pete Ricketts issued statements supporting the merger because of its economic impacts on their state. U.S. Transportation Secretary Sean Duffy is not commenting officially on the merger at this time, a DOT source told FreightWaves, who pointed out that the STB has exclusive jurisdiction over rail mergers and Federal Railroad Administration (FRA), a modal agency within DOT, 'will perform its limited, safety-focused role in the process, specifically, to monitor the safety of railroad operations pursuant to a Safety Integration Plan,' the source said. 'Safety is FRA's top priority.' Senior Bond Analyst Jay Cushing of researcher Gimme Credit said that the deal would produce combined revenue of $36.5 billion, operating earnings (EBITDA) of close to $18 billion, an operating ratio of 61%, and free cash flow of $2.6 billion. 'We estimate pro forma gross debt of $70 billion and net debt/EBITDA of 3.8x,' Cushing said in an email to FreightWaves. 'This is about a turn above current last 12 months net leverage at Union Pacific (2.6x). Management is targeting $2.75 billion of run rate synergies over three years split between revenues ($1.75 billion) and costs ($1 billion). The synergy target amounts to 7.5% of combined revenue and looks reasonable when compared to a 9% target for the recent Canadian Pacific/Kansas City Southern merger.' Cushing noted that Norfolk Southern was late implementing precision railroading 'and we see room for operating rate compression between the industry laggard (NS) and leader (UP). Management expects combined free cash flow (before dividends) to grow from $7 billion in 2024 to $12 billion by 2029 driven by synergies and 10% base-line growth. 'Both companies will suspend share repurchases and with no funding plans until the deal closes, we expect cash to build on the balance sheet ($2 to $3 billion annually) helping moderate debt issuance needs. We view management's net leverage target of 2.8x by 2028 as achievable.' — with reporting by Trains magazine and John Gallagher of FreightWavesThis article was corrected July 30 to clarify that CN supports collaboration among article was edited July 31 to include reaction from US Transportation Secretary Sean Duffy and a statement from the FRA. Subscribe to FreightWaves' Rail e-newsletter and get the latest insights on rail freight right in your inbox. Find more articles by Stuart Chirls say Union Pacific-Norfolk Southern merger will reverse rail freight decline Shippers line up against railroad mergers Union Pacific and Norfolk Southern reach $85 billion merger deal First look: Norfolk Southern earnings The post While shippers cite merger concerns, rival railroad looks instead to 'collaborations' appeared first on FreightWaves. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
9 hours ago
- Business
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Report: CSX talks with investment bank about merger options
CSX has declined to comment on a Bloomberg report that it has engaged Goldman Sachs to advise it about potential merger options. Today's news follows this week's announcement that Union Pacific (NYSE: UNP) will acquire Norfolk Southern (NYSE: NSC) in an $85 billion deal that would create the first transcontinental freight railroad. Industry analysts believe the UP-NS combination will put pressure on BNSF Railway and CSX (NASDAQ: CSX) to respond, either through a merger of their own or by BNSF launching a bid for NS. BNSF has declined to comment. CSX Chief Executive Joe Hinrichs said last week — prior to the UP-NS announcement — that the railroad would not rule out merger talks. Activist investor Ancora on Wednesday said that CSX could be a merger target if its performance metrics continue to lag the other Class I railroads. Subscribe to FreightWaves' Rail e-newsletter and get the latest insights on rail freight right in your deal will open new markets for top US container port Activist investor may target CSX, citing slumping financial performance While shippers cite merger concerns, rival railroad looks instead to 'collaborations' CEOs say Union Pacific-Norfolk Southern merger will reverse rail freight decline The post Report: CSX talks with investment bank about merger options appeared first on FreightWaves. Sign in to access your portfolio
Yahoo
11 hours ago
- Business
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CSX working with Goldman Sachs to explore strategic options, Bloomberg News reports
(Reuters) -Railroad operator CSX is working with Goldman Sachs to explore strategic options following a merger between its two major rivals, Bloomberg News reported on Thursday, citing people familiar with the matter. Union Pacific said on Tuesday it would buy smaller rival Norfolk Southern in an $85 billion deal to create the first U.S. coast-to-coast freight rail operator and reshape the movement of goods from grains to autos across the country. Reuters reported last week that CSX was in talks to bring on financial advisers. "We welcome all opportunities that would allow us to deliver value for our shareholders, drive pro-growth and serve our customers better," CSX CEO Joe Hinrichs said on a post-earnings call last week. Goldman Sachs did not immediately respond to a Reuters request for comment. CSX declined to comment. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
14 hours ago
- Business
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CSX working with Goldman Sachs to explore strategic options, Bloomberg News reports
(Reuters) -Railroad operator CSX is working with Goldman Sachs to explore strategic options following a merger between its two major rivals, Bloomberg News reported on Thursday, citing people familiar with the matter. Union Pacific said on Tuesday it would buy smaller rival Norfolk Southern in an $85 billion deal to create the first U.S. coast-to-coast freight rail operator and reshape the movement of goods from grains to autos across the country. Reuters reported last week that CSX was in talks to bring on financial advisers. "We welcome all opportunities that would allow us to deliver value for our shareholders, drive pro-growth and serve our customers better," CSX CEO Joe Hinrichs said on a post-earnings call last week. Goldman Sachs did not immediately respond to a Reuters request for comment. CSX declined to comment.
