CHATTANOOGA/GREENEVILLE, TN: July 06, 2018. Covenant Transportation Group has acquired Landair Holdings and subsidiaries Landair Transport and Landair Logistics for US$83 million plus US$15 million of debt.

Landair is a dedicated and for-hire truckload carrier as well as supplier of 3PL transportation, warehousing and logistics inventory management services. Founded in 1981, it operates 430 trucks and 900 trailers and manages 12 distribution facilities totaling 1.8 million square feet of warehouse space.

The company reported revenue of US$121 million last year with US$60 million from dedicated truckload operations, US$41 million from managed freight services and US$20 million from one-way truckload operations.

Covenant Transportation Group (CTG) reported Q1 2018 revenue of US$173.6 million, a year-on-year increase of 9.3 percent, operating income of US$6.4 million and net income of US$4.44 million.

“We pursued Landair because of their proven record of growth and profitability in the dedicated and 3PL markets, their talented management team led by John Tweed, and the quality and integrity of their culture represented by their co-founder, Scott Niswonger,” commented CTG chairman and CEO David Parker.

“Landair is a perfect fit with our strategy to grow in areas where we can get closer and more heavily integrated with customers. We believe the backing of CTG will provide additional resources to expand Landair’s dedicated truckload operations to best meet the needs of its strong customer base, as well as improve profit margins through identified cost synergies,” he added.

Parker said Landair’s existing managed freight business is expected to immediately improve CTG’s collective managed freight service offering.

“I am excited about this combination because it will give Landair and its customers access to, and the benefit of, the comprehensive resources of CTG,” said Landair president John Tweed. “Continued growth at the pace we are experiencing requires access to the resources and support of a strong partner like CTG. The alignment in company cultures should enable a smooth integration of the two well-respected organizations.”

CTG’s estimates Landair’s 2018 EBITDA to be US$18.5 - US$19.0 million and the company expects its Q2 earnings to rise from US$1.5 million or US$0.08 cents per share to $0.45 to $0.53 per share after acquisition-related expenses.