XPO to spin off contract logistics
The 3PL’s directors have approved a plan to pursue a spin-off of its logistics segment as a separate publicly traded company.
XPO intends to structure the spin-off as a transaction that is tax-free to XPO shareholders and would result in XPO shareholders owning stock in both companies.
If completed, the spin-off will result in businesses with clearly delineated offerings: XPORemainCo, a global provider of less-than-truckload (LTL) and truck brokerage transportation services; and NewCo, the second largest contract logistics provider in the world. Both companies are expected to trade on the New York Stock Exchange.
XPO Logistics CEO Brad Jacobs said: “By uncoupling our transportation and logistics segments, we intend to create two high-performing, pure-play companies to serve the best interests of all our stakeholders.”
The transaction is expected to be completed in the second half of 2021.
Post-separation, NewCo will be the second largest contract logistics company in the world, with approximately 200 million square feet of warehouse space. The business will comprise:
- A range of services enabled by intelligent technology, including high-value-add warehousing, omnichannel fulfillment, reverse logistics, cold-chain logistics and supply chain optimisation
- The largest outsourced eComm fulfillment platform in Europe, with burgeoning eComm and reverse logistics services in North America
- XPO Direct, a shared-space distribution network in North America with the flexibility to reposition customer inventories close to demand
As of September 30, 2020, XPO had asset-light logistics operations in 27 countries, with approximately 58,000 employees and 766 locations.
