Truckload and logistics provider Celadon Group Inc. has sold off two of its transportation lines in its ongoing effort to raise cash and continue its recovery from financial and accounting problems that led to the company's stock being delisted in 2018 from the New York Stock Exchange (NYSE).
Indianapolis-based Celadon said last year that it would restate four years of financial results due to accounting regularities. And in 2017, steep financial losses led to the resignation of then-President and COO Eric Meek and the replacement of many executive positions at the troubled firm.
Celadon has now sold its A&S Kinard and Buckler Transport subsidiaries for $139.5 million.The firm will use some $67.5 million of the proceeds to pay down A&S's equipment debt and capital leases, and use the balance to pay transaction expenses, to reduce borrowings under the company's revolving credit agreement, and to provide additional liquidity, Celadon said.
"Over the past several quarters, we have been diligently focused on streamlining our business, improving the results of our core North American truckload operations, improving our capital structure, and resolving the accounting, litigation, and regulatory issues that had arisen under prior management," Celadon CEO Paul Svindland said in a release. "The sale of A&S/Buckler marks another material milestone toward executing our plan. We anticipate additional announcements in the near term as we focus on positioning the Company to pay down additional debt, refresh our tractor fleet, complete our financial restatement and audits, and solidify our capital structure."
The purchaser was an affiliate of Day & Ross Inc., a Canadian less than truckload (LTL), truckload, and dedicated carrier and a subsidiary of McCain Foods Limited. "We appreciate the contributions of A&S/Buckler team over the several years they were part of our Celadon family of companies," Svindland said. "They have outstanding businesses and will find a strong fit and home at Day & Ross, which is building a leading dedicated truckload business in North America."
According to Celadon, it had acquired the York, Pa.-based A&S and Roulette, Pa.-based Buckler businesses in 2014-15, and used them to provide regional, dedicated, and specialized transportation services in the Northeast and Mid-Atlantic regions. In 2018, A&S and Buckler generated approximately $160.4 million in revenue, excluding certain operations that were not included in the transaction, Celadon said.