- Union contract negotiations at TForce Freight and ABF Freight stand in the way of any potential TFI International acquisition of ArcBest, TFI Chairman, President and CEO Alain Bédard said on a Q1 earnings call this week.
- “We're too busy with the storm, and too busy trying to get a contract in place with the Teamsters,” Bédard said, when asked about how the rumored M&A deal was progressing. “So, for now, I would say there's nothing going on, and we'll see down the road.”
- A pair of smaller tuck-ins in Canada are expected to be announced this year, and an acquisition “of size” could come as soon as later this year or next, Bédard said. He did not specify any of the potential acquirees.
The International Brotherhood of Teamsters has promised to “fight like hell” for its 15,000 members in contract negotiations at the two companies’ union-represented U.S. LTL units. The union did not respond to a request for comment on Bédard’s earnings call statements.
Montreal-based TFI still plans to spend at least $300 million on M&A and buybacks this year, its CEO said. The first Canada acquisition — “a fantastic deal” — could come “very soon,” Bédard said. And a second one in the country that could be finalized later in 2023.
Three separate analysts on the Q1 earnings call, however, wanted to know more about TFI’s plans for any potential M&A of Fort Smith, Arkansas-based ArcBest.
TFI sold 50,000 shares of ArcBest stock last quarter to remain below a 5% ownership threshold that would require additional reporting, Bédard said.
The company aims to execute a sizeble M&A deal every three years. Any ArcBest deal would be among “a few opportunities that we're looking at right now,” Bédard said, urging investors to “stay tuned.”
“We have the capacity; we have the knowhow,” he said. “So something may happen on something of size before the end of the year or into next year.”
While contract bargaining could be delaying M&A at unionized LTL carriers, labor concerns haven’t yet prompted shippers to shift noticeable volumes to their non-unionized competitors.
“I don't know that you can really point to contract negotiations or whatever the case as any reason that we're getting business,” he said. “We haven't really seen that.”