C.H. Robinson to Acquire Freightquote

EDEN PRAIRIE, Minn. (December 1, 2014) – C.H. Robinson (Nasdaq: CHRW) today announced that it has reached an agreement to acquire Freightquote.com, Inc. for $365 million in cash. The agreement is subject to certain customary closing conditions, including regulatory approval. Closing of the acquisition is expected to occur in the first quarter of 2015. C.H. Robinson will likely increase its existing revolving credit facility to finance the acquisition.

Freightquote is a privately-held freight broker providing services throughout North America. Freightquote’s calendar 2014 gross revenues are projected to be approximately $623 million, net revenues are projected to be approximately $124 million and adjusted EBITDA is projected to be approximately $34 million.

Founded in 1999 by Tim Barton, Freightquote is one of the largest internet-based freight brokers in the United States. Headquartered in Kansas City, MO with approximately 1000 employees, Freightquote provides truckload, less than truckload and intermodal services to approximately 80,000 customers.

“Freightquote is a high quality, innovative, growth company that brings a proven model serving smaller businesses. Its proprietary e-commerce technology allows shippers to easily access competitive rates and automated load acceptance and payment functionality. E-commerce is going to be a bigger part of future supply chain services and Freightquote brings us a leading solution in our industry,” said John Wiehoff, C.H. Robinson chairman and chief executive officer. “Along with their track record of success, Freightquote has an established brand, a talented management team, excellent people, and a performance-based company culture.”

Wiehoff continued, “Freightquote brings synergies to our less than truckload and truckload businesses as well as a talented technology team with expertise developing a great e-commerce store front experience. We look for quality companies and Tim has built a great model and team at Freightquote.”

“With the addition of Freightquote, we will increase our market share with small businesses and significantly expand our presence in the Kansas City market,” said Scott Satterlee, C.H. Robinson senior vice president of North America Surface Transportation. “We have built our business over decades by providing unparalleled service to all types of customers and we are honored to add this strong organization dedicated to that same strategy. Freightquote will operate as one of our flagship operations in Kansas City and we plan to continue to aggressively grow the operations there,” Satterlee said.

Tim Barton, Executive Chairman of Freightquote, will serve as a consultant to Freightquote following the closing of the acquisition.

“We spent a long time looking for the right strategic partner and are pleased to join the C.H. Robinson organization,” said Tim Barton. “The two companies complement each other and together we are well positioned for success into the future.”

Morgan Stanley & Co. LLC is serving as financial advisor to Freightquote.com, Inc.

Conference Call Information:

C.H. Robinson Freightquote Acquisition Conference Call

Tuesday, December 2, 2014 8:30- 9:00 a.m. Eastern Time

Presentation slides and a simultaneous live audio webcast of the conference call may be accessed through the Investor Relations link on C.H. Robinson’s website at www.chrobinson.com

To participate in the conference call by telephone, please call ten minutes early by dialing: 800-533-9703

Callers should reference the conference ID, which is 7779752

Webcast replay available through Investor Relations link at www.chrobinson.com

Telephone audio replay available until 9:30 a.m. Eastern Time on December 9: 888-203-1112; passcode: 7779752#

For more information about the presentations or webcasts, please contact C.H. Robinson’s Investor Relations Department at 952-683-5007 or email tim.gagnon@chrobinson.com

Founded in 1905, C.H. Robinson is one of the largest non-asset based third party logistics companies in the world. C.H. Robinson is a global provider of multimodal transportation services and logistics solutions, currently serving over 46,000 customers through a network of over 280 offices in North America, South America, Europe, and Asia. C.H. Robinson maintains one of the largest networks of motor carrier capacity in North America and works with approximately 63,000 transportation providers worldwide. For more information about our company, visit our Web site at www.chrobinson.com.

Except for the historical information contained herein, the matters set forth in this release are forward-looking statements that represent our expectations, beliefs, intentions or strategies concerning future events. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from our historical experience or our present expectations, including, but not limited to such factors as changes in economic conditions, including changes in market demand and pressures on the pricing for our services; competition and growth rates within the third party logistics industry; freight levels and availability of truck capacity or alternative means of transporting freight, and changes in relationships with existing truck, rail, ocean and air carriers; changes in our customer base due to possible consolidation among our customers; our ability to integrate the operations of acquired companies with our historic operations successfully; risks associated with litigation and insurance coverage; risks associated with operations outside of the U.S.; risks associated with the potential impacts of changes in government regulations; risks associated with the produce industry, including food safety and contamination issues; fuel prices and availability; and the impact of war on the economy; and other risks and uncertainties detailed in our Annual and Quarterly Reports. In addition, such forward-looking statements relate to the expected closing date of the acquisition and the anticipated benefits of the acquisition. Actual results could differ materially from those projected in these forward-looking statements as a result of (i) unexpected delays in obtaining regulatory approvals; (ii) the inability of either C.H. Robinson or Freightquote.com, Inc. to satisfy the conditions to the consummation of the acquisition; (iii) unforeseen difficulties in integrating the operations of Freightquote; or (iv) unanticipated negative reaction to the proposed transaction by customers or suppliers. In addition, our expectation regarding the increase in our current revolving credit facility is subject to negotiation of acceptable terms and documentation with the lenders. Any forward looking statement speaks only as of the date on which such statement is made, and we undertake no obligation to update such statements to reflect events or circumstances arising after such date.

Tim Barton to be Honored as Greater Kansas City Business Hall of Fame Laureate

We’ve been talking a lot about Freightquote’s founder in Freightquote news recently, and we’re not done yet. We’re proud to tell you Tim Barton is a 2014 Greater Kansas City Business Hall of Fame Laureate.

The Greater Kansas City Business Hall of Fame acknowledges inspirational business leaders who have demonstrated the importance of sound fiscal practices and entrepreneurialism that are also taught by Junior Achievement.  JA is the world’s largest organization dedicated to educating students about workforce readiness, entrepreneurship and financial literacy through hands-on programs. The Junior Achievement of Middle America program will reach more than 20,000 students in Kansas City this year.  The laureates encourage Junior Achievement participants to pursue careers in business and contribute to their community.

The awards ceremony will be held Thursday, November 13 at the Kansas City Marriott Downtown.  Proceeds from the event benefit Junior Achievement’s efforts in the empowerment of young people. You can purchase your tickets by visiting http://jamidamerica.org/hall_of_fame.

Fighting the Truck Driver Shortage

This is not a new conversation, but it is a relevant one.  The freight industry still does not have enough truck drivers.

It began in 2008 with the number of truck drivers rapidly tumbling until finally bottoming out in 2010. There has been growth each year since, but we are still 6.4% below 2007 totals. (Source) With the recovering economy and truck tonnage at record highs, there is significant concern and much discussion around how and when the number of truck drivers on the road will return to demand appropriate levels.

Let’s talk through some of the factors contributing to the shortage which include driver age, pay, the recruiting funnel, and work- life balance.  Former truck driver, Grant Bunton, spoke of driving over the road and the want of more home time, “It’s a very difficult lifestyle. It’s a blast, but it’s difficult.  You do get to see lots of places but rarely do you have time to actually stop and take in the scenery. After about three years of driving, I met my lovely wife one weekend when I was home. At that point I knew that I would want to spend more than 36 hours per week at home.”  Work- life balance has been growing in priority in the US for quite some time and it seems truck drivers have taken notice.  We’ll get you home more often is an anthem sung by many trucking companies in their driver recruiting efforts.  While pay is a major factor, time in your own bed seems to be just as important. Schneider National is, along with many other carriers,  addressing the money issue by raising driver pay, but they are also putting emphasis on getting their drivers home more often in an effort to improve the balance between work and home. (Source)

A problem that can’t be combatted with pay raises or more home time is age. It is one of the first things to mind when looking at truck driver shortage. Not only is recruiting and retaining drivers a challenge, but there is a large number nearing retirement age.  Truckers News found more than one in three drivers are older than 55 with a whopping 6% under the age of 35.  So, it sounds like it’s time to start some heavy recruiting, right?

The industry has upped recruiting efforts in order to fill the gap. Those efforts include targeting women and transitioning military veterans along with traditional methods like recruiting from driving schools and attracting drivers already on the road. Appealing to the younger audience is still a challenge. They prefer industries like technology or health care to life on the open road. (Source) So, how are we going to find the additional 90,000 + drivers that the ATA Benchmarking Guide for Driver Recruitment and Retention says are needed each year over the next decade? One theory, talk about it and share within social networks. Are people outside of the freight industry aware of this need?

While the shortage of carriers is quite painful for the companies that need to move their goods, the carrier side of the freight industry has seen a lift in pricing as demand has grown. The shortage of over the road drivers has had a positive impact on LTL and intermodal freight as well.  LTL carriers are picking up freight they may not have if not for the capacity shortage from lack of long haul drivers, giving them greater control of pricing. The same can be said of intermodal. This finds many shippers turning to third party providers for help with controlling cost and locating trucks. Freightquote founder, Tim Barton, in a recent interview with the Kansas City Business Journal said, “…if you increase demand, and you artificially suppress supply…then in a very fragmented market like freight, the best thing to do then is go to third parties like us.” (Source)

Freightquote employees give back

Kansas City Kansas Reviving Baseball in Inner Cities (KCK RBI) is raising funds for a stadium renovation. This program and its goals have found their way into Freightquote’s heart and our employees showed just how much by raising nearly $20,000 in one week.

The funds were raised by raffle ticket sales and a silent auction featuring items such as Royals playoff tickets and coveted parking spots at our Kansas City headquarters. Freightquote matched the amount raised by its employees for a total contribution of nearly $40,000 to KCK RBI’s field renovation efforts.

KCK RBI is a program that is aimed at improving the lives of Kansas City, KS youth through baseball and softball. The program includes more than 900 children who learn physical fitness, teamwork, leadership, and life skills for on and off the field, with the greatest emphasis on education.  Founded in 2010, KCK RBI has built an amazing program, and Freightquote employees want to help them build a great stadium where kids can play 8 out of 12 months of the year. The facility will also include study halls and equipment to aid the children’s education that can be used all year round.

Part of Freightquote’s mission is community involvement. We’re proud to support organizations like KCK RBI. If you’re interested in contributing to this great program, visit http://www.pastimepie.com.

National Truck Driver Appreciation Week 2014

To the drivers of America:

In observance of National Truck Driver Appreciation Week, a heartfelt thanks to each and every one of you that keeps the wheels turning.

We were fortunate enough to thank a few drivers from our carrier network in person this morning, but want to make sure our gratitude is expressed to every hard working truck driver.

Every day, you are moving the goods and supplies each of us rely on in our business and personal lives. You’ve seen the country and experience the challenges and rewards of a unique career. We truly appreciate the job you do and the time you spend doing it.

Sincerely,

The Freightquote Team

Freightquote Attends Niagara Bottling’s Carrier Partner Conference

Early this year, Freightquote struck a partnership with Niagara Bottling, LLC. So, when we received an invitation to Newport Coast, CA for their 2nd Annual Carrier Partner Conference at the end of August, we were thrilled to accept and spend a little quality time with our customer while enjoying a bit of that beautiful California coast.

At this event Niagara reviewed topics key to their business, including their future outlook and operational updates. Justin Simien, Premier Client Manager, stated, “The event really highlighted Niagara’s priorities and initiatives. This insight and knowledge is critical to the partnership and management of their freight.” In addition, the information learned and shared while at the conference prepares both Freightquote and Niagara for the 2015 RFP process.

Also in attendance, learning, networking and enjoying the ocean view, were Tom Krenning, VP of Truckload Operations and Jason Beer, VP of Enterprise Solutions.

Tim Barton named Regional Entrepreneur of the Year

Freightquote founder and executive chairman, Tim Barton, has been named Regional Entrepreneur of the Year by the Council for Entrepreneurship and Innovation and the Regnier Institute for Entrepreneurship and Innovation at the University of Missouri – Kansas City Henry W. Bloch School of Management.

The Regional Entrepreneur of the Year award is presented each year to a distinguished entrepreneur or innovator of a Kansas City area organization. In 1998, Barton founded Freightquote, leveraging technology to connect freight shippers with carriers. Over the past 16 years, Freightquote has grown to over 1,000 employees moving over 1 million shipments each year with annual revenues exceeding $600 million.

Barton will be honored at the 29th Annual Entrepreneur of the Year Awards dinner and ceremony on Oct 14, 2014 at the Kansas City Convention Center. All proceeds of the event benefit the Regnier Institute of Entrepreneurship and Innovation at the Bloch School of Management.

The award presentation wraps Henry Bloch Entrepreneurship Week. Barton will be featured during a “Second Wednesdays” presentation on Wednesday, Oct 8, 2014, as part of the series of events.

For more information on the Entrepreneur of the Year Awards, Entrepreneurship Week and the honorary dinner, visit the UMKC Bloch School of Management website