UPS has confirmed the sale of Coyote Logistics, a freight brokerage firm based in Chicago, to RXO, Inc. for a sum exceeding $1 billion. Following the acquisition, RXO is set to become the third-largest brokered transportation provider in North America. The agreement includes a commitment for RXO to continue managing UPS’s transportation needs through a contract that extends until January 2030. Regulatory approval is required before the transaction can be finalized, expected by the close of 2024. Coyote Logistics presently collaborates with a network of 100,000 carriers to handle 10,000 daily loads.
“As UPS positions itself to become the premium small package provider and logistics partner in the world, the decision to sell our Coyote Logistics business allows an even greater focus on our core business,” said UPS Chief Executive Officer Carol B. Tomé.
“RXO’s highly accretive acquisition of Coyote will immediately increase the scale of our brokerage business, providing customers with more capacity across a wider array of power lanes,” said Drew Wilkerson, chief executive officer of RXO. “RXO will realize significant synergies from the acquisition by quickly integrating Coyote’s business into RXO and leveraging our cutting-edge technology. The addition of Coyote’s customer base will diversify RXO’s vertical mix and will increase the number of customers that do more than $1 million in business with us by approximately 80%. This acquisition will provide RXO with both immediate and long-term opportunities for revenue and earnings growth and will generate significant returns for shareholders. I look forward to welcoming Coyote’s employees to our team and working together to achieve excellent results for our customers, shareholders, carrier partners and employees for years to come.”
In January 2024, UPS indicated that Coyote Logistics might be sold following a significant drop in revenue. UPS had purchased Coyote Logistics for $1.8 billion in the summer of 2015.
