Third-party logistics provider (3PL) Cardinal Logistics Management Corp. has been acquired by the Miami-based private equity firm H.I.G. Capital in a move to expand Cardinal's dedicated trucking offering in a tight freight market, the companies said today.
Terms of the deal were not disclosed. Cardinal had previously been owned by Centerbridge Partners L.P., a New York-based private investment management firm.
Founded in 1997, Concord, N.C.-based Cardinal provides fully outsourced transportation and logistics services. The company's dedicated contract carriage offerings allow customers to lock in dedicated fleets and drivers, servicing complex route structures with scheduled pick-ups and deliveries across distribution centers, suppliers, and stores, Cardinal said.
The investment comes as the freight market has backed off its historically tight conditions of 2018, but remains stubbornly higher than usual, pushing retailers to seek new options for controlling their rising transportation costs.
"We believe Cardinal represents a compelling opportunity to invest in transportation and logistics, especially as supply chains become more complex and locking in reliable, dedicated capacity takes on mission-critical importance," H.I.G. Managing Director Richard Stokes said in a release. "As customers continue to outsource their transportation and logistics needs, we expect Cardinal to become an increasingly important strategic partner."
Cardinal executives said they expect to leverage the new ownership in a new phase of growth and expansion in the sector. "We are excited about Cardinal's growth prospects and believe our clients and employees will benefit immensely from H.I.G.'s support as we embark on our next growth phase," Cardinal CEO Tom Hostetler said in a release.
According to the investment bank Harris Williams, which represented Cardinal in the deal, its new owner has a record of investing in the companies it acquires. "We are excited for the new partnership between Cardinal and H.I.G.," Jeff Kidd, a director at Harris Williams, said in a release. "H.I.G. is an excellent go-forward strategic partner for Cardinal and will be able to help the company capitalize on numerous growth opportunities."