C.H. Robinson Worldwide, Inc. announced it has reached a stock purchase agreement to acquire Phoenix International, Inc. for $571.5 million in cash and approximately $63.5 million in newly-issued C.H. Robinson stock. The agreement is subject to certain customary closing conditions, including regulatory approval. Closing of the acquisition is expected to occur in the fourth quarter of 2012. C.H. Robinson will use existing cash and plans to enter into a revolving credit facility with major banks to finance the cash portion of the purchase price. The acquisition is expected to be modestly accretive in the first year.
Phoenix is a privately-held international freight forwarder. In its most recently completed fiscal year, as of June 30, 2012, Phoenix generated gross revenues of approximately $807 million, net revenues of approximately $161 million and adjusted operating income of approximately $48 million.
Phoenix primarily provides international freight forwarding services, including ocean, air, and customs brokerage, currently serving approximately 15,000 customers globally. Phoenix has approximately 2,000 employees, located in 76 offices in 15 countries. The company is headquartered in Chicago, Illinois.
“Phoenix is a high quality growth company that brings additional expertise and scale to a key part of our long term growth strategy,” said John Wiehoff, C.H. Robinson chairman and chief executive officer. “It has strong customer and carrier relationships, a talented management team and excellent people, and a performance-based company culture that is very similar to Robinson’s.”
Wiehoff continued, “We see significant long-term opportunity in international forwarding as global trade expands, scale and technology continue to become more important, and shippers increasingly look to transportation providers to provide global services.”
Bill McInerney, executive chairman of Phoenix, founded the company in 1979. Following the completion of the acquisition, McInerney plans to retire. Other key executive management will assume management positions with C.H. Robinson. Phoenix chief executive officer Stéphane Rambaud, 48, will lead the combined international freight forwarding services of C.H. Robinson and Phoenix.
“Joining with C.H. Robinson enables Phoenix to offer its customers a broader menu of services, leverage combined volumes more efficiently, and provide employees with even greater career path opportunities,” said McInerney. “Although I will not be part of the enterprise going forward, I share the enthusiasm for the future that has so excited the Phoenix leadership team.”