Atlanta, Georgia – In a strategic move aimed at streamlining its operations, United Parcel Service (UPS), the largest package delivery company in the world, has announced the sale of its Coyote Logistics business unit. The deal, valued at $1.025 billion, will see RXO acquire the business, according to an announcement made by the companies on Sunday.
RXO, based in North Carolina, revealed that the transaction will be financed through a combination of equity and debt, with significant equity investments from MFN Partners and Orbis Investments. UPS CEO Carol Tome emphasized that divesting Coyote Logistics will allow the company to sharpen its focus on its core business operations.
Coyote Logistics, originally acquired by UPS in 2015 for $1.8 billion from private equity firm Warburg Pincus, caters to the transportation of freight for shippers and carriers. The decision to sell the business unit follows UPS’s strategy to bolster its full-truckload services and optimize its service offerings.
By offloading Coyote Logistics, UPS aims to realign its resources and attention towards enhancing its primary delivery services. This move underscores the company’s commitment to refining its operations and maximizing efficiency in an increasingly competitive market environment.RXO, a key player in the freight movement sector, stands to benefit from the acquisition, expanding its portfolio and strengthening its position in the industry.
Overall, the sale of Coyote Logistics by UPS marks a significant development in the logistics and transportation industry, showcasing the company’s strategic decision-making and adaptability in response to evolving market dynamics. As UPS refines its focus and resources, industry analysts will keenly observe how this move shapes the company’s future trajectory and competitive edge in the global logistics landscape.