Coming soon to a fleet theater near you: Deals on wheels

TORONTO – – The experts have been saying it all along: If you survive this recession, you will emerge stronger and ready to roll.

On the other hand, if the banks have finally decided to call up the repo man and you’re getting foreclosed on….

That’s part of the message that comes from a recent — and very comprehensive, we might add — report on deal-making in the trucking business, courtesy of the giant consultants, Price Waterhouse Coopers.

The Coles Notes version: Globally, there’ve been far fewer people buying trucking and logistics companies than over the past two years; the country’s known as BRIC (Brazil, Russia, India and China) are coming on strong, and the fact that this recession has eaten away and slayed lots of bottom feeders means that the survivors will live to share the booty.

The report’s got the ungainly title “Intersections: Second-quarter 2009 global transportation and logistics mergers and acquisitions analysis.” You can access the full item here.

Meantime, what you have to know is this: According to the report, the number of deals was down 45 percent in the second quarter of 2009, compared to the first quarter, and overall values of those deals dropped 55 percent over the same time period.

Rounding Third: Foreign truckers accounted
for much of trucking’s global growth, says
PWC, but Canada’s rebound is coming too.

There were US $4.5 billion worth of deals globally in all of last year, involving 31 deals. That’s a whopping 67-percent drop from the previous year.

The BRIC countries (get used to the term, you’re going to hear it a lot) accounted for the lion’s share of the really big deals; and finally, the experts believe the turnaround is nigh.

“In North America,” says Eric Castonguay, Canadian corporate finance leader for the transportation and logistics sector, of PWC, “we expect M&A activity in this sector to increase as shipping volumes and rates stabilize, providing acquirers with more comfort of a sustained recovery.”

“U.S. retail sales in August rose by 2.7 percent, which was the highest monthly increase in three years,” Castonguay says, with the proviso that most of the gain was driven by the “cash for clunkers” stimulus program and gains in the clothing, electronics and general merchandise sectors were a more modest 0.6 percent.

Castonguay continues: “Further supply-side adjustments through the exit of weaker participants and reduced fleet volumes will be necessary to stabilize rates and increase the financial health of the sector, particularly in the truckload segment.”

So turn up your phone volume. It might just start ringing again. 

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