RADIANT LOGISTICS ACQUIRES STRATEGIC OPERATING PARTNER COMPANIES SELECT LOGISTICS, INC. AND SELECT CARTAGE, INC.

Rhea-AI Summary

Radiant Logistics, Inc. (NYSE American: RLGT) has acquired Select Logistics, Inc. and Select Cartage, Inc., both Doral, Florida based companies, to strengthen its cruise logistics service offering in South Florida. The transaction is structured similarly to previous ones, with a portion of the purchase price payable based on the future performance of the acquired operations. Select will transition to the Radiant brand and combine with existing company-owned operations in south Florida. Gabby Santos will assume the role of General Manager, while Hector Cavallo will pursue outside interests. This acquisition represents a significant milestone in the continued evolution of Radiant, according to the Founder and CEO, Bohn Crain.

Insights

Market Research Analyst

The acquisition of Select Logistics, Inc. and Select Cartage, Inc. by Radiant Logistics, Inc. represents a strategic consolidation within the logistics sector, which is likely to enhance Radiant's service offerings in the South Florida region, particularly in the cruise line logistics niche. This move may be indicative of Radiant's broader strategy to strengthen its position in the market by integrating specialized services that complement its existing portfolio.

From a market research perspective, the focus on cruise line logistics is noteworthy, as the cruise industry is a significant economic contributor in Florida. The acquisition could enable Radiant to capitalize on the post-pandemic recovery of the cruise industry, which has seen renewed growth. By bolstering its capabilities in this area, Radiant may be better positioned to secure contracts with major cruise lines, potentially increasing market share and revenue.

Furthermore, the transaction structure, with a portion of the purchase price contingent on future performance, aligns the interests of the acquired entities with Radiant's financial goals. This earn-out arrangement can motivate the Select team to continue delivering high performance, thus potentially enhancing shareholder value over time.

Financial Analyst

The financial structure of the acquisition is particularly interesting, as it suggests a performance-based earn-out which is often used to mitigate risk and align the incentives of the acquisition targets with those of the acquiring company. This structure can be beneficial for Radiant's financial health, as it may limit upfront cash outlays and tie future payments to actual performance metrics, potentially safeguarding against overpayment for the acquired entities.

While the immediate financial impact of the acquisition on Radiant's balance sheet and income statement is not detailed, the long-term expectations would include revenue growth and possible cost synergies. Investors should monitor the integration process closely, as the success of such acquisitions can vary and may impact the company's earnings and stock performance in both the short-term and long-term.

Supply Chain Expert

The acquisition of Select by Radiant Logistics underscores the importance of specialized knowledge in the logistics industry, particularly for complex sectors like cruise logistics. Integrating Select's expertise with Radiant's existing operations could result in enhanced supply chain solutions for clients. This synergy may lead to improved efficiency, better customer service and the potential for Radiant to offer more competitive pricing structures.

Given the logistical complexities associated with the cruise industry, such as coordinating supplies for ships and managing tight schedules, Select's expertise could be a significant asset. The specialized knowledge and established relationships with customers and vendors that Select brings to the table can be difficult to replicate, thereby potentially creating a competitive advantage for Radiant in a niche market.

Strengthens Company's Cruise Logistics Service Offering in South Florida

RENTON, Wash., Feb. 7, 2024 /PRNewswire/ -- Radiant Logistics, Inc. (NYSE American: RLGT), a leading provider of technology-enabled global transportation and value added logistics solutions, today announced it has acquired Select Logistics, Inc. and Select Cartage, Inc. (collectively "Select"), both Doral, Florida based, privately held companies that have operated as part of the Company's Adcom Worldwide brand since 2007. The Company structured the transaction similar to its previous transactions, with a portion of the expected purchase price payable in subsequent periods based on the future performance of the acquired operations.

Originally founded in 2007 and operated by Gabby Santos and Hector Cavallo, Select provides both domestic and international freight forwarding services and is well recognized for its expertise and in-depth knowledge and support of the cruise line industry. On a post-closing basis, Select is expected to transition to the Radiant brand and will combine with existing company owned operations in south Florida. Gabby Santos will assume the role of General Manager for the newly combined organization which will continue to develop and deliver advanced supply chain solutions for their cruise line and other customers. Hector Cavallo will be moving on to pursue outside interests. 

Gabby Santos of Select commented, "Through years of dedicated service, our entire team here in Florida has developed some very strong relationships with our customers, vendors and associates around the globe. Our customers have always remained our top priority whether they were here in the United States or abroad and this philosophy has been key to our success. We were happy when Radiant acquired Adcom Worldwide back in 2008 and are looking forward to flying the Radiant flag ourselves here in Florida. Radiant has consistently provided an environment for us to grow our business over the years and it has been rewarding to be a part of the building momentum of the Radiant network. We are excited to now transition our business in a way that meets our own personal goals while also ensuring the continued success of our customers and employees."

"The Select transaction and our long-standing partnership with Gabby and Hector represents another significant milestone in the continued evolution of Radiant," remarked Radiant's Founder and CEO, Bohn Crain. "We launched Radiant in 2006 with the goal of partnering with logistics entrepreneurs who would benefit from our unique value proposition and the built-in exit strategy available to the entrepreneurs participating in our network. We are pleased to be able to support both Hector and Gabby in this transition and are excited for this next chapter with Gabby and the team in Florida."

About Radiant Logistics (NYSE American: RLGT)

Radiant Logistics, Inc. (www.radiantdelivers.com) is a publicly traded third party logistics company providing technology-enabled global transportation and value added logistics solutions primarily to customers based in the United States and Canada. Through its comprehensive service offering, Radiant provides domestic and international freight forwarding along with truck and rail brokerage services to a diversified account base including manufacturers, distributors and retailers which it supports from an extensive network of Radiant and agent-owned offices throughout North America and other key markets around the world. Radiant's value-added logistics services include warehouse and distribution, customs brokerage, order fulfillment, inventory management and technology services.

This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, regarding future operating performance, events, trends and plans. All statements other than statements of historical fact contained herein, including, without limitation, statements regarding our future financial position, business strategy, budgets, projected revenues and costs, and plans and objectives of management for future operations, are forward-looking statements. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "may," "will," "expects," "intends," "plans," "projects," "estimates," "anticipates," or "believes" or the negative thereof or any variation thereon or similar terminology or expressions. We have based these forward-looking statements on our current expectations and projections about future events.. These forward-looking statements are not guarantees and are subject to known and unknown risks, uncertainties and assumptions about us that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. Important factors that could cause our actual results to differ from our expectations, include but are not limited to, the performance of our historic business at levels consistent with recent trends and reflective of the synergies we believe will be available to us as a result of our recent acquisitions; and those risk factors that apply to our operations as disclosed in Item 1A of our Report on Form 10-K for the year ended June 30, 2023 and other filings with the Securities and Exchange Commission and other public documents and press releases which can be found on our web-site (www.radiantdelivers.com). Readers are cautioned not to place undue reliance on our forward-looking statements, as they speak only as of the date made. Such statements are not guarantees of future performance or events and we undertake no obligation to disclose any revision to these forward-looking statements to reflect events or circumstances occurring after the date hereof.

 

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SOURCE Radiant Logistics, Inc.

FAQ

What companies did Radiant Logistics, Inc. acquire?

Radiant Logistics, Inc. acquired Select Logistics, Inc. and Select Cartage, Inc.

Where are the acquired companies based?

The acquired companies are based in Doral, Florida.

What is the ticker symbol for Radiant Logistics, Inc.?

The ticker symbol for Radiant Logistics, Inc. is RLGT.

Who will assume the role of General Manager for the newly combined organization?

Gabby Santos will assume the role of General Manager.

What is the role of Hector Cavallo after the acquisition?

Hector Cavallo will be pursuing outside interests after the acquisition.