Landstar System To Sell Supply Chain Companies To XPO Logistics For $87 Mln

(RTTNews) - Landstar System Inc. (LSTR) announced Wednesday that it has signed a definitive agreement to sell its Michigan-based supply chain subsidiaries or "LSCS" to XPO Logistics Inc. (XPO) for $87.0 million in cash.

The Landstar Board of Directors also has declared a special one-time dividend in the amount of $0.35 per share, payable on January 16, 2014, to shareholders of record on December 27, 2013, and has increased the number of shares of Landstar common stock the Company is authorized to purchase from time to time on the open market or otherwise to three million shares.

The transaction is anticipated to close late in the 2013 fourth quarter or early in the 2014 first quarter pending Hart-Scott-Rodino clearance and the satisfaction or waiver of certain other customary closing conditions. The purchase price is subject to customary post-closing adjustments.

The sale is expected to result in an estimated after-tax gain on sale of approximately $32 million or approximately $0.71 per diluted share and is expected to generate approximately $50 million in additional cash to Landstar, after estimated working capital adjustments.

For the 2012 fiscal year, LSCS generated earnings before interest, taxes, depreciation and amortization or "EBITDA" of $7.3 million.

Landstar's LSCS supply chain operations were created by Landstar's contemporaneous but separate acquisitions in 2009 of (i) Premier Logistics, Inc., which included National Logistics Management or "NLM" and Interactive Capacity Gateway LLC, and (ii) A3 Integration, LLC. After the closing of the sale of these companies to XPO, Landstar will maintain offices in the Southfield/Detroit area to continue its more than 25 year history of providing safe, reliable transportation services and capacity solutions to its automotive customers.