RXO Inc. has solidified its position in the logistics sector by agreeing to purchase United Parcel Service Inc.’s (UPS) asset-light freight brokerage business, Coyote Logistics, for over $1 billion. This acquisition will see RXO ascend to the status of the third-largest brokered transportation provider in North America.
Charlotte, North Carolina-based RXO plans to fund the deal through a combination of equity and debt. Notable investments include a $300 million equity injection from MFN Partners and a $250 million equity contribution from Orbis Investments, both major stakeholders in RXO.
RXO anticipates realizing substantial synergies from the integration of Coyote Logistics into its operations. The transaction is expected to close by the end of the fiscal year, positioning RXO for enhanced service offerings and market reach. For more detailed information, the original coverage can be found on Bloomberg Law.
The agreement also includes a provision for RXO to continue providing freight brokerage services to UPS through January 2030, ensuring a seamless transition and ongoing collaboration between the entities.