Why U.S. Xpress Enterprises Shares Are Skyrocketing Today
$KNX
$USX
Trucking Freight/Courier Services
Industrials
Trucking Freight/Courier Services
Industrials
- Knight-Swift Transportation Holdings Inc (NYSE:KNX) has agreed to acquire U.S. Xpress Enterprises Inc (NYSE:USX) for a total enterprise value of ~$808 million, excluding transaction costs.
- The total enterprise value represents Knight-Swift assuming USX's $484 million of outstanding debt and finance leases and purchasing its outstanding equity for $324 million, or $6.15 per share.
- The deal represents a 310% premium over USX's closing stock price of $1.50 on Mar. 20, 2023.
- As part of the deal, Max Fuller, Executive Chairman of U.S. Xpress, and Eric Fuller and related entities will rollover a portion of their shares of USX into an approximately 10% interest in a new Knight-Swift subsidiary formed to hold the U.S. Xpress business post-closing.
- U.S. Xpress is expected to add ~$2.2 billion in total operating revenue (including $1.8 billion in truckload revenue), 7,200 tractors, and 14,400 trailers to Knight-Swift's consolidated enterprise.
- The combined revenue run-rate for Knight-Swift after the transaction is expected to be close to $10 billion, and the truckload fleet will consist of about 25,000 tractors and 93,000 trailers.
- KNX expects the transaction to be accretive to its adjusted earnings per share starting in 2024.
- U.S. Xpress will continue as a separate brand and operation to minimize disruptions for the driving associates, shop and office employees, and customers.
- Knight-Swift had ~$1.3 billion unrestricted cash and available liquidity on Dec. 31, 2022, a portion of which will fund the transaction.
- Upon completion of the transaction, which is expected late in Q2 or early Q3 of 2023, USX will de-list from the NYSE.
- Price Action: KNX shares are trading higher by 5.95% at $56.24, and USX is higher by 286.67% at $5.98 on the last check Tuesday.
- Photo Via Company