Note: Revenues for privately held companies are statistical evaluations. At less than $1 billion in revenue, LaserShip is significantly smaller than national deliverers UPS and FedEx, but maintains a strong regional network focused on densely populated areas in the eastern US.LaserShip has exhibited substantial growth in its e-commerce delivery business, especially during 2020 and continuing into 2021 as the company shifted focus to the e-commerce space from its traditional B2B business, with significant new customer wins and very substantial throughput with delivery volumes more than doubling. googletag.pubads().collapseEmptyDivs(); 1,358 Following. LaserShip has agreed to buy Arizona-based OnTrac Logistics. For more information, visit ontrac.com. However, some perspective is needed before the coronation begins. The combined company will bring together two complementary operating footprints across the United States. B2C is profitable, you just have to change how you approach it from an operations, pricing and service delivery perspective. They also value the regionals as safety valves should FedEx and UPS continue to impose volume limitations, she said. October 13, 2021. googletag.cmd.push(function() { MOODY'S adopts all necessary measures so that the information it uses in assigning a credit rating is of sufficient quality and from sources MOODY'S considers to be reliable including, when appropriate, independent third-party sources. @LaserShipAssist. Prior to joining American Securities, Will was a Senior Managing Director at . VIENNA, Va. (PRWEB) February 28, 2023. All Rights Reserved. For more information, visit american-securities.com. Associate New York. "If [LaserShip/OnTrac] doubled in volume . The leading representative office of defined VC is situated in the New York. googletag.enableServices(); Satish Jindel, president of Shipmatrix, said the LaserShip/OnTrac deal proved there is money to be made in B2C delivery, running counter to the duopolys growing focus on shifting the mix toward more profitable B2B shipments. Will Manuel, chairman of the LaserShip/OnTrac board and managing director of American Securities, said in a statement. Founded in 1986, LaserShip is based in Vienna, Virginia and has sorting centers in New Jersey, Ohio, North Carolina, and Florida.. As of 2016, LaserShip has 63 distribution centers and four sorting centers servicing 22 states and Washington, D.C., and handles deliveries for Amazon's Same Day . In March 1998, UPS controlled 64% of pick-ups in the U.S. ground parcel market, which at the time was dominated by business-to-business (B2B) deliveries, according to SJ Consulting, a consultancy. It looks like a 12x-15x price they paid for OnTrac, but if they can take advantage of this hot parcel market and future growth, this could be a great acquisition, Erickson said. Because of the possibility of human or mechanical error as well as other factors, however, all information contained herein is provided AS IS without warranty of any kind. Regional parcel delivery carrier LaserShip/OnTrac said late Tuesday that it has named Mike Duffy the company's new CEO, effective immediately. We enjoy our work and the relationships that come from it. Get the latest business insights from Dun & Bradstreet. The ultimate objective is to build out a coast-to-coast delivery network to compete with the large national carriers. The deal has generated much excitement in the last-mile delivery world. Josh Dinneen, Chief Commercial Officer at LaserShip and OnTrac, told LM that this transcontinental service is a huge win for retailers, as it empowers them to reach consumers in the countrys most populated areas with faster, reliable, cost-effective home delivery. For more information, visit ontrac.com. MOODYS PUBLICATIONS MAY ALSO INCLUDE QUANTITATIVE MODEL-BASED ESTIMATES OF CREDIT RISK AND RELATED OPINIONS OR COMMENTARY PUBLISHED BY MOODYS ANALYTICS, INC. Our focus is always on the long-term best interests of the companies and investors we serve. Acquisition activity may be muted over the course of 2021 as LaserShip delivers volume growth through its existing network, but the company could look to expand geographically through acquisitions.The stable outlook reflects Moody's expectation for LaserShip to generate earnings growth on substantially higher delivery revenues to maintain debt/EBITDA below 6.5x and generate positive free cash flow.The B2 rating on the first lien senior secured credit facilities, one notch above the company's B3 CFR, takes into account this debt's priority position in the company's liability structure ahead of the second lien term loan, which provides first-loss absorption in the event of a default. Kevin Penn, Helen Chiang, and Former Learning Care Group CEO Barbara Beck. Edit Funding Rounds Section. A same-day delivery done by FedEx could cost Amazon $50, according to Kevin Porter, who has worked for LaserShip, FedEx, and UPS as a courier. Further information on the UK endorsement status and on the Moody's office that issued the credit rating is available on www.moodys.com.Please see www.moodys.com for any updates on changes to the lead rating analyst and to the Moody's legal entity that has issued the rating.Please see the ratings tab on the issuer/entity page on www.moodys.com for additional regulatory disclosures for each credit rating. There has been industry talk for several years about regional carriers joining forces to stitch together a national network and seriously challenge UPS and FedEx. }); Kelly Picard, CEO of Hackbarth Delivery Services Inc., a regional carrier based in Mobile, Alabama, agreed that even in aggregate the regionals are Lilliputians in the land of the twin giants. Only wholly-owned subsidiaries are required to provide subsidiary guarantees, posing risks of potential guarantee release if there were a partial change in ownership. Founded in 1999, Greenbriar is a private equity firm managing over $6 billion of total committed capital focused on investments in market-leading services and manufacturing businesses. Please refer to Moody's Policy for Designating and Assigning Unsolicited Credit Ratings available on its website www.moodys.com.Regulatory disclosures contained in this press release apply to the credit rating and, if applicable, the related rating outlook or rating review.Moody's general principles for assessing environmental, social and governance (ESG) risks in our credit analysis can be found at https://www.moodys.com/researchdocumentcontentpage.aspx?docid=PBC_1243406.The Global Scale Credit Rating on this Credit Rating Announcement was issued by one of Moody's affiliates outside the EU and is endorsed by Moody's Deutschland GmbH, An der Welle 5, Frankfurt am Main 60322, Germany, in accordance with Art.4 paragraph 3 of the Regulation (EC) No 1060/2009 on Credit Rating Agencies. The efficiencies generated by these routes are effectively passed on to the shipper, which explains why the regionals price-service proposition can be appealing, she said. Moodys said it expects pursuit of national coverage to continue in 2022, through further acquisitions or expansion of existing assets or both. http://www.greenbriarequity.com, For LaserShip: They acquired OnTrac Shipping for $1.3B. We maintain the highest personal and corporate ethics through honesty and fair dealing. LaserShip/OnTrac, the largest regional e-commerce parcel carrier in the U.S. and leader in e-commerce last-mile delivery, today announced the appointment of . "Private equity is moving into logistics and supply chains in a huge way," Mr Haber said. One top executive said that the news was unexpected and that there was no inkling of a change in the works. 2023 American Securities. googletag.enableServices(); Logistics }); By 2020, UPS share of the total ground delivery market had fallen to 35%, according to SJ data. Holifield left Home Depot as its top supply chain executive and his hiring by a regional parcel carrier took virtually everyone by surprise. American Securities could fill those gaps through acquisitions or internal expansion. We are committed to fostering an inclusive environment that promotes and values diversity. Satish Jindel, SJs founder and CEO, and an adviser to FedEx on the Caliber deal, said UPS believed at the time that RPS was too insignificant to warrant much attention. googletag.defineSlot('/21776187881/FW_Super_Leaderboard', [[300, 50], [970, 90], [300, 100], [728, 90]], 'div-gpt-ad-1668097889433-0').defineSizeMapping(gptSizeMaps.banner2).addService(googletag.pubads()); Nicole Chen is an associate in Weil's Private Equity practice and is based in New York. Average cost savings when switching to LaserShip. LaserShip is a regional last-mile delivery company that services the Eastern and Midwest United States. Faster transit time than national carriers. It provides a more cohesive solution over a much larger geographic area than is currently in place.. Weil Gotshal & Manges LLP - Douglas P. Warner , Brittany Butwin , Geneve Say , Harris Ahmad , Monica Kwok , Tiffany . Our new service fills that void and were excited to serve as a supportive, long-term partner for our customers, he said. Moody's also assigned B2 ratings to the company's proposed first-lien credit facilities, consisting of a $75 million . About Greenbriar Equity Group He also held various high-level supply chain roles at prominent brands like consumer giant Procter & Gamble Co. (NYSE: PG) and health care provider Cardinal Health Inc. (NYSE: CAH). Based in New York with an office in Shanghai, American Securities is a leading U.S. private equity firm that invests in market-leading North American companies with annual revenues generally ranging from $200 million to $2 billion. FedEx and UPS have far from perfected deliveries in this world, and therein lies the chance for the merged entity and for regional carriers to make inroads, he said. googletag.enableServices(); Two-plus decades of share erosion in its core business have taught UPS not to repeat that behavior if and when a new model walks on the field, Jindel said. LaserShip is the leader in e-commerce last-mile delivery for retailers and shippers that desire reduced transit times and increased flexibility within their supply chain. ASP LS Acquisition Corp. (d/b/a LaserShip), a Vienna, Va.-based regional last-mile package delivery service provider, has entered into an agreement to be acquired by American Securities LLC. The term loan is not expected to have any financial maintenance covenants.In terms of corporate governance, Moody's expects LaserShip's financial policy to be relatively aggressive given its new private equity ownership. While some experts said the deal doesnt pose an immediate threat to the duopoly of UPS and FedEx on a national level, all agree its a wake-up call for them and a boon for shippers facing volume limits, cost spikes and service level challenges. The company provides same-day and next-day residential delivery services for small parcels (<50 lbs) through its fast growing network of 110+ facilities across 30 states. googletag.pubads().collapseEmptyDivs(); Diego Kantt is the current Principal at American Securities.Prior to this, they held Board Member positions at Phoenix Tower International, The Blackstone Group, Metrotel, Phoenix Tower do Brasil, and Neutral Duty Free Shop.. Diego has over 25 years of experience in the retail industry, with a focus on branded products and . Matt Bohn, a senior consultant with Shipware, said it will be business as usual for now with other regional carriers like LSO, Speedy and Pitt Ohio, but market pressure is sure to follow. LaserShip's $1.3-billion deal for OnTrac gives it delivery coverage on both U.S. coasts. Get the latest business insights from Dun & Bradstreet. Less clear is whether the wrenching changes made regional carriers and especially the promise of a national network more enticing. gptAdSlots.push(gptSlot); Many team members at Unicorn Nest are Ukrainians affected by Russian aggression. Moody's also assigned B2 ratings to the company's proposed first-lien credit facilities, consisting of a $75 million revolver expiring 2026 and a $675 million term loan due 2028, and a Caa2 rating . In Private Equity. About OnTrac Logistics, Inc. LaserShip and OnTrac will begin to link their networks in 2022 to ensure seamless service for customers during the 2021 peak holiday season. Nicole Chen. It will be the only pure-play national e-commerce solution in last-mile parcel delivery and will enhance customers ability to meet growing demand in the consumer delivery market. #LaserShip #ceo #team. It continues to be such an . In a news release, the companies said the two will form "a leading national network and solution" for shippers. The allegations are often complex, and the plaintiffs must prove that the defendant violated securities . By joining with LaserShip, we will be well positioned to continue innovating and providing leading service for shippers, and faster delivery for consumers. Reach out to the author: contact and available social following information is listed in the top-right of all news releases. Tuesdays announcement also caught employees off-guard. The conventional wisdom is that regional carriers offer competitive rates because of their relatively low overhead. Copyright 2023, All Rights Reserved, FreightWaves, Inc. Should FedEx, UPS care about the LaserShip-OnTrac merger? Diego Kantt is the current Principal at American Securities. The number of new customers has increased rapidly of late, and remains to be seen whether the company can service all of its customers at the required service levels. Mike Erickson, CEO of shipping consultancy AFMS, said the deal was a big win for domestic parcel shippers, given the good reputation and service levels of both companies, providing more options as the operations are merged. for questions regarding your package. Will Manuel joined American Securities in 2016. googletag.enableServices(); MOODYS CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS AND PUBLICATIONS DO NOT CONSTITUTE OR PROVIDE INVESTMENT OR FINANCIAL ADVICE, AND MOODYS CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS AND PUBLICATIONS ARE NOT AND DO NOT PROVIDE RECOMMENDATIONS TO PURCHASE, SELL, OR HOLD PARTICULAR SECURITIES. That month, FedEx closed on a deal announced the prior October to acquire Caliber System Inc., whose Roadway Package System (RPS) unit had been quietly nibbling at UPS competitive position for 13 years. aharsch@american-securities.com. The most obvious path forward, then, is to expand its delivery coverage to fill out the middle of the country, according to industry experts. So Amazon sources cheaper options. Amy Harsch LaserShip is part of a portfolio within American Securities and Greenbriar and said that both companies will provide additional equity financing and continued strategic support for the combined company. This decreases the value of a national, integrated network another reason LaserShip doesnt need immediate national coverage.. Non-NRSRO Credit Ratings are assigned by an entity that is not a NRSRO and, consequently, the rated obligation will not qualify for certain types of treatment under U.S. laws. . If you've already placed an investigation and it's been more . . It is unclear what Holifields next move will be. Holifield was named the companys CEO in October 2021 after a long career at The Home Depot Inc. (NYSE: HD). It is today as near to having a national footprint as any company still classified as a regional delivery carrier. Will began his career at Chase Securities in the Mergers & Acquisitions group. That didnt appear to be the case pre-pandemic. The combined company plans an expansion into the Texas market in the very near future and to eventually add Chicago to its network. (2 minutes) Last-mile delivery specialist LaserShip Inc. on Friday said it named Mark Holifield chief executive, poaching the veteran supply . Securities class action lawsuits are filed on behalf of a class of investors or a class of holders of a particular security. NEW YORK and STAMFORD, Conn., March 12, 2021 /PRNewswire/ -- Conair Corporation, a global leader in premium kitchen electric appliances . Further, LaserShip faces high turnover of its independent contractors which could challenge the company's service times and quality.Moody's expects LaserShip to have adequate liquidity, with nominal cash balances balanced by availability under the new $75 million revolver and positive free cash flow, with at least low-single digit free cash flow to debt. Will Manuel joined American Securities in 2016. Regional carrier LaserShip is acquiring competitor OnTrac in a $1.3 billion deal, in one fell swoop changing the equation in domestic last-mile parcel delivery by giving the combined entity coverage of three-quarters of the continental U.S. as ecommerce demand continues to soar. window.googletag = window.googletag || {cmd: []}; LaserShip is a portfolio company of American Securities and Greenbriar, and both will provide additional equity financing and continued strategic support for the combined company. LaserShip / OnTrac is a leading last-mile delivery solutions provider, serving eCommerce retailers. This merger of two strong companies is a testament to the extraordinary efforts of our team members to build a leading parcel carrier and logistics business, said Mike Roth, Board member and interim CEO of LaserShip. Strong growth is likely to continue over the next couple of years as consumers become accustomed to less than two-day delivery times for ecommerce purchases.. We aim to be respectful in all of our interactions. googletag.pubads().enableSingleRequest(); LaserShip is a leading provider of same-day and next-day delivery services in the eastern and Midwest U.S. LaserShip partners with more than 5,000 independent contractors to make residential and business deliveries for some of the world's largest retailers using an integrated hub-and-spoke delivery network. Formerly the Executive Editor at DC Velocity, Mark Solomon joined FreightWaves as Managing Editor of Freight Markets. 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