Truckload carrier Celadon Group Inc., late yesterday said it acquired A&S Services Group LLC, a regional dry van truckload carrier and warehouse operator based in New Freedom, Pa., for $55 million in cash and the assumption of $31.8 million in operating leases.
The transaction expands Indianapolis-based Celadon's geographic scope in the Northeast and mid-Atlantic regions, where A&S primarily operates and where Celadon is not particularly visible. A&S will do business as an independent entity, and Celadon has no plans to integrate the companies, at least for the foreseeable future. A&S' current management and administrative staff are staying on with Celadon.
A&S operates a fleet of 500 rigs and 1,500 trailers, has 500,000 square feet of warehouse space, and recently launched a freight brokerage unit. Notably, in an industry beset by driver shortages and increasing churn, A&S' driver turnover rate is at 20 to 25 percent, far below the average of about 103 percent for large truckload fleets during the second quarter. John G. Larkin, lead transport analyst for Stifel, Nicolaus & Co., said the ultra-low turnover is due to a short average length of haul—200 miles and less—that gives drivers more home time. By contrast, Celadon drivers' average length-of-haul is 800 to 900 miles, Larkin said.
In a note today, Larkin said Celadon does not want to risk a "hasty integration" for fear of disrupting the favorable driver situation at A&S.
