CHICAGO – STG Logistics announced Friday that it has expanded its leading position in containerized logistics through the acquisition of the intermodal division of XPO Logistics, one of the largest providers of container transportation services in North America.
The combined business will go to market as STG Logistics. As part of this transaction, STG, a portfolio company of Wind Point Partners since 2016, was recapitalized by Wind Point as well as funds managed by Oaktree Capital Management, L.P., including Oaktree’s Transportation Infrastructure Investing and Global Opportunities Group.
STG CEO Paul Svindland and STG President and CFO Geoff Anderman will continue to lead the company. Current STG COO Todd Larson will lead the legacy STG operations as EVP of STG and COO of STG’s Distribution segment, and Paul Smith, formerly president of XPO’s intermodal division, will lead STG’s intermodal operations as EVP of STG and COO of STG Intermodal.
“I could not be more excited about this game-changing acquisition,” Svindland said. “We are combining STG’s leading position in facility-based container logistics with XPO Intermodal’s leading position in container transport, creating a platform with unparalleled capabilities. Once combined, the STG network will be able to handle a container from the instant it’s ready at a port or customer facility to the moment each individual shipment arrives at its final destination, all the while providing customers full visibility and a single source of accountability.”
STG is a leading provider of facilities-based containerized logistics services including container deconsolidation, reconsolidation, transloading, warehousing, and outsourced transportation solutions including final mile delivery. STG operates a nationwide facility network comprised of 28 port locations totaling more than five million square feet and maintains relationships with more than 65 inland partners who enable final mile access to all major metro areas. Since Wind Point’s investment in 2016, STG has more than quadrupled in size through organic growth and 10 add-on acquisitions.
The XPO intermodal division acquired by STG is North America’s third largest provider of containerized transportation services, providing intermodal drayage and rail brokerage services for retailers, manufacturers, third party logistics providers, and other types of customers. The network features 48 locations, 11,000 containers, 2,200 tractors, and 5,200 chassis. The division was formed through XPO’s purchase of Pacer in 2014 and Bridge Terminal Transport in 2015.
“We are thrilled to complete this initial stage of our journey with the team at STG and excited to have the opportunity to reinvest in the combined business as it embarks on its next phase of growth,” Konrad Salaber, managing director at Wind Point, said. “STG is expected to exceed $1.7 billion in 2022 revenue and maintains an aggressive strategy for growth focused on transloading, warehouse solutions, fulfillment, and domestic intermodal services. We’re also excited to be partnering with Oaktree, a group we know well with a highly successful track record investing in a variety of port, rail, and related logistics infrastructure assets.”
Financing for the transaction was led by Antares Capital and included Deutsche Bank Direct Lending, Stifel, Citizens, and MUFG. Kirkland & Ellis provided transaction counsel to Wind Point and Oaktree and McCarter & English provided transportation counsel to STG, Wind Point and Oaktree. KPMG and PWC provided transaction advisory services on the transaction. Deutsche Bank Securities Inc. acted as M&A adviser to STG Logistics and Oaktree on STG’s acquisition of XPO’s intermodal division. Harris Williams acted as M&A adviser to STG Logistics and Wind Point on the recapitalization of STG. Raymond James acted M&A adviser to XPO Logistics.
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