UPS Inc. and Overnite Corp. announced an
agreement Monday, May 16, for UPS to acquire Overnite for about $1.25 billion.
The transaction will allow UPS to offer less-than-truckload
and truckload services to its North American customers. The agreement comes
just five months after UPS expanded its airfreight services by acquiring Menlo
“Overnite is a perfect strategic fit for our company,” said
Mike Eskew, UPS chairman and CEO, in a written statement.
The acquisition, expected to close during the third quarter
of 2005, is an all-cash transaction that will require regulatory approvals and
the approval of Overnite’s shareholders. The Overnite Board of Directors has
unanimously OK’d the agreement and recommended approval by its shareholders.
Based in Richmond, VA, Overnite serves more than 60,000
customers in the LTL and TL segments with operations in the United States,
Canada, Mexico, Puerto Rico, Guam and the U.S. Virgin Islands. Its other
operating company, Motor Cargo, is a regional less-than-truckload carrier
primarily serving the western United States, Canada and Mexico.
Together, they form one of the largest LTL carriers in the
United States with more than 200 service centers and 14,200 employees.
Overnite’s management team is expected to remain in place to
run the business.