Roadrunner freight raises $50 million for the development of technology underpinning its operations
DOWNERS GROVE, Ill., March 25, 2021 /PRNewswire/ -- Roadrunner Freight ("Roadrunner" or the "company") (Pink: RRTS) today announced the recent closing of a $50 million equity private placement. The round was led by Andrew Leto, founder of GlobalTranz and Emerge, who invested $10 million and is joining Roadrunner's Board. Other round participants included affiliates of Elliott Investment Management, Fox Hill Capital, Memento S.A., Solas Capital, existing management and several individuals from the transportation and logistics sector, including Kevin Shuba, who has also joined Roadrunner's Board.
"Roadrunner is really a technology moving trucks, not a trucking company. Every shipper needs a consolidator like Roadrunner, and most are not taking advantage of what Roadrunner has to offer. We are changing that. This team has done a great job cleaning up a mess and getting Roadrunner back to its roots in LTL," said Andrew Leto. "I look forward to helping drive this transformation, especially through our technology development."
Roadrunner anticipates using the net proceeds for investment in the development of technology underpinning operations, specifically around planning, pricing and efficiency, and to recruit and retain top talent. It also intends to continue to invest in service improvements.
"We are thrilled to welcome partners to this business who share our vision of an unwavering focus on service and quality for our customers and an improved experience for our drivers," said Chris Jamroz, Executive Chairman of Roadrunner.
The private placement was structured in the form of shares that have a liquidation preference equal to the subscription price (net of any distributions). The subscription price reflected an approximately 15% discount to the trading price at the time the deal was negotiated in early 2021.
Andrew Leto and Kevin Shuba Join Roadrunner Board of Directors
Andrew Leto, CEO of Emerge, and Kevin Shuba, recently departed CEO of OmniTRAX, have joined Roadrunner's Board of Directors as Independent Directors. Donald Brown, Scott Dobak and Paul Svindland remain as Independent Directors on Roadrunner's Board.
Jamroz commented, "Andrew and Kevin join us as meaningful owners in our business with the energy and knowledge to help drive significant value creation as we continue our transformation."
Andrew Leto is founder and CEO of Emerge, a cloud-based shipping platform and marketplace helping logistics professionals to more efficiently procure and manage their overflow truckload capacity. Founded by Leto in 2017, Emerge is on track to generate $250 million in sales this year, making it one of the fastest growing supply chain technology companies. Leto has been in the logistics industry since 2003 when he founded GlobalTranz, a top five customer for Roadrunner, after serving five honorable years in the U.S. Navy. GlobalTranz quickly became one of the top-10 Truckload and LTL brokers in the U.S. with over $1 billion dollars in sales. Leto also founded 10-4 Systems, a truckload and visibility platform which was acquired by Trimble in 2016.
Kevin Shuba served as the CEO of OmniTRAX, Inc., one of North America's largest private railroad holding companies, for over seven years. He remains a senior advisor to the OmniTRAX parent company, The Broe Group. As CEO he led the daily operations of 22 Short Line Railroads, Port and Terminal Operations, and OmniTRAX Logistics Services. Prior to joining OmniTRAX and The Broe Group, Shuba had a sixteen-year career with Brambles Limited, the $6 billion dollar logistics services company, where he oversaw Chep's U.S. and Americas operations. Prior to joining Brambles, Shuba held several senior sales and management positions with Baxter Healthcare Corporation. Additionally, he served in the United States Army for six years obtaining the rank of Captain.
Frank Hurst, Partner and President of Roadrunner, added, "Andrew and Kevin are already proving to be invaluable partners in bolstering our capabilities. It is no surprise they have both created such successful organizations."
Dave Ross Named Partner and Executive Vice President for Roadrunner
Dave Ross, former Managing Director and Group Head of Stifel's Global Transportation and Logistics Equity Research practice, has been named Partner and Executive Vice President for Roadrunner. In this role, Ross will focus on operations and pricing, while working with the Board to set strategic vision for the company as a whole. He brings over 20 years of extensive experience, study and knowledge of the LTL industry.
"Dave will play a critical role in architecting the emergence of the new Roadrunner," Jamroz stated.
During Ross' tenure at Stifel, his awards included ranking #1 in stock picking multiple times in the Wall Street Journal's Best on the Street Analysts Survey and in Financial Times/StarMine America's Top Analysts report. He is the former author of the monthly Cass Transportation Index Report, speaks regularly at industry conferences, and has advised supply chain leaders and executives of both public and private carriers, shippers, and 3PLs on operations and strategy.
Roadrunner Provides Update on Service, Launch of Guaranteed Service
January and February operated with record level on-time delivery rates and the lowest exceptions in company history. Due to the continued service improvements, Roadrunner will be launching a guaranteed service offering in select lanes by the end of spring 2021.
About Roadrunner Freight
Roadrunner Freight is a leading less-than-truckload provider offering high quality, reliable LTL services. Roadrunner's "Ship It Like You Own It" commitment guides the company to provide unparalleled service and reliable LTL solutions for customers. With 31 service centers and strategic partnerships across the country, Roadrunner delivers expansive long haul, regional and next day service in all major US markets.
For more information, please visit www.shiproadrunnerfreight.com.
For information on joining the Roadrunner Freight team, please contact firstname.lastname@example.org. Independent Contractors and Owner Operators interested in driving and lease purchase opportunities can call 888-874-9174 or email email@example.com to learn more.
Safe Harbor Statement
This press release contains forward-looking statements and information relating to, among other things, Roadrunner, its business plans and strategies, its industry and other future events. These statements include those relating to Roadrunner's shift in LTL strategy, its plan to prioritize service levels over profitability, and its ability to rectify service issues." Forward-looking statements are often, but not always, made through the use of words or phrases such as "may," "will," "anticipate," "estimate," "plan," "project," "continuing," "ongoing," "expect," "believe," "intend," "predict," "potential," "opportunity," and similar words or phrases or the negatives of these words or phrases. These forward-looking statements are based on Roadrunner's current assumptions, expectations, and beliefs and are subject to substantial risks, estimates, assumptions, uncertainties and changes in circumstances that may cause Roadrunner's actual results, performance, initiatives, or achievements to differ materially from those expressed or implied in any forward-looking statement. Because the risks, estimates, assumptions and uncertainties referred to above could cause actual results or outcomes to differ materially from those expressed in any forward-looking statements, you should not place undue reliance on any forward-looking statements. Any forward-looking statement speaks only as of the date hereof, and, except as required by law, Roadrunner assumes no obligation and does not intend to update any forward-looking statement to reflect events or circumstances after the date hereof.
SOURCE Roadrunner Freight