Titanium Transportation last week announced the opening of its seventh U.S. freight brokerage in Jacksonville, Fla., and followed that up today with its first acquisition of an asset-based U.S. carrier.
Titanium has agreed to purchase Oakwood, Ga.-based Crane Transport for US$53 million, as well as its head office in Georgia and satellite terminal in Alabama for an additional US$6 million.
Crane Transport is a truckload carrier that generates about US$60 million in annualized revenue with 200 trucks.
“Today’s announcement is further evidence of Titanium executing on its strategic plan and continuing to build a strong foundation for future growth in North America,” Titanium CEO Ted Daniel said in a release. “The addition of Crane Transport’s full truckload business is highly synergistic within our existing network, immediately adding capacity and valuable new customer relationships. The acquisition will allow us to expand our presence across the United States through our new strategically located terminals in Georgia and Alabama, expanding our service offerings and enabling us to offer a wide range of services including end-to-end supply chain and freight management solutions to our existing customers.”
Daniel believes Titanium will be able to enhance Crane’s profitability by optimizing equipment and technology. Meanwhile, it gives the Canadian company a presence in Georgia and Alabama. Both terminals sit on about 11 acres of land.
Danny Crane, who founded the company in 2001, said: “I am pleased to have the Crane team join the Titanium family. I feel the business and culture of Titanium is a perfect fit for our group moving forward. I am confident that Titanium’s strong platform and growth strategy will be a perfect fit for Crane. Their focus on innovation and technology, as well as culture will provide opportunities of growth for our employees, while continuing to deliver reliable service to customers, every mile of the way.”
In a press release announcing the acquisition, Titanium said Crane revenues will gradually grow after integration, expected to be completed in about 12 months. However, the company lowered its 2023 revenue guidance to CDN$450-$470 million from previous expectations of $500 to $520 million, mostly due to lower fuel surcharges but also due to pricing pressures and softer freight demand.
On a call with investors, Daniel offered further insights into the deal. He noted the strategic importance of Crane’s Georgia home, 30 minutes from Titanium’s existing logistics office in Atlanta, and within “Freight Alley” consisting of the Carolinas, Tennessee, Georgia and Alabama.
“Transportation represents a significant portion of this region’s economy,” Daniel said.
Crane equipment will be rebranded as Titanium, and it will be fully integrated in about a year. Daniel said Titanium is more advanced in terms of technology that it will roll out to the Crane fleet. However, Crane’s equipment is modern.
“The average age of their trucks is quite reasonable. There’s almost no requirement for truck replacements at this time,” Daniel said.
Titanium feels the presence of an asset-based fleet in the U.S. will enhance its third-party logistics businesses there, as the company can now engage in interstate trucking and offer more holistic offerings to its new and existing customers.
Peter Stefanovich, president of M&A advisors Left Lane Associates, advised Titanium on the deal. He agreed the two companies are an ideal fit.
“We are proud to have helped transact on Titanium’s first U.S. acquisition,” Stefanovich said. “Crane Transport will add new scale to Titanium’s growing U.S. presence, coupled with their opening of additional freight brokerages in the Southeastern U.S.”
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