Dive Brief:
- Schneider National’s recent acquisition of M&M Transport is unlikely to be its last addition to its dedicated trucking business, President and CEO Mark Rourke told analysts during the company’s Aug. 3 earnings call.
- The company expects the addition of M&M Transport will raise its dedicated contract revenues to $1.5 billion this year. M&M’s financial results will be included in Schneider’s Q3 earnings as part of its dedicated operations.
- Schneider doesn’t plan on making another dedicated trucking acquisition before the end of the year, Rourke said. But as for future deals, he said, “it wouldn’t surprise me at all that we continue on the pace.”
Dive Insight:
Schneider’s purchase of Massachusetts-based M&M Transport in early August marked its third acquisition in the dedicated segment since January 2022. Schneider has grown its dedicated services business from 33% of its truckload segment in 2017 to 57% in 2022 and is optimistic of future opportunities.
Rourke told analysts that organic growth in its dedicated segment is a priority. However, the company will consider a deal if it fits within its criteria.
Those conditions include being well-run dedicated contract carriers with established relationships with customers, he said. Potential acquisitions also should be companies with between 25 years and 30 years of operational history without a solid succession plan.
“I think we're a very attractive suitor for those types of individuals,” Rourke said during the call. “We've developed an approach and a process, I believe, that makes us a very viable acquirer.”
That process involves retaining employees as well as a company’s name. M&M Transport will operate as a wholly owned subsidiary of Schneider.
Though Schneider won’t rule out other acquisitions to continue growing its dedicated trucking business, it is open to deals that would benefit the company as a whole.
“I wouldn't also rule out something more transformative if we felt that, that was in the best interest of our shareholders and that we could advance our strategy,” Rourke told analysts. “But certainly, the programmatic acquisition at dedicated is something that we're interested in continuing.”
