Phoenix, AZ — Knight-Swift Transportation Holdings Inc. (NYSE: KNX) has announced the acquisition of the non-union regional less-than-truckload (LTL) division of Dependable Highway Express, Inc. (Dependable), based in Los Angeles. The deal involves acquiring both operating assets and certain liabilities associated with Dependable’s LTL division, known as DHE.
This acquisition is set to provide an immediate boost to Knight-Swift’s earnings per share. CEO Adam Miller expressed enthusiasm about the transaction, noting that it marks a significant step in building a nationwide LTL network. The addition of DHE enhances Knight-Swift’s presence in key Southwest markets including California, Arizona, and Nevada. The expansion increases the company’s LTL terminal and door counts by about 10%, broadening its network coverage to approximately 70% of the U.S. population.
Miller highlighted the strategic importance of integrating DHE into Knight-Swift’s existing operations, including AAA Cooper and MME, to offer seamless coast-to-coast service. He welcomed DHE employees to the Knight-Swift family and expressed anticipation for enhanced opportunities and service offerings resulting from the merger.
Dependable CEO Ronald Massman reflected on the sale, stating that while the Massman family had not initially planned to sell the division, the strategic alignment with Knight-Swift’s vision for a leading national LTL business made the deal compelling. Massman praised Knight-Swift for its adherence to core values of Integrity, Service, and Diversity, and expressed confidence in the future growth of the combined LTL business.
Financial terms of the transaction were not disclosed, but it is estimated that DHE generated approximately $122 million in total operating revenue over the past year, with a 10% operating margin. Post-acquisition, DHE will operate as a separate brand within the AAA Cooper corporate group. Joe Finney, formerly COO of DHE, will continue as President of DHE.
Scudder Law acted as legal advisor to Knight-Swift, while Houlihan Lokey served as financial advisor to Dependable, with Proskauer providing legal counsel to Dependable.
