SCS Transportation announced late Friday, June 30 that it had completed the $40 million cash sale of Jevic, its hybrid less-than-truckload and truckload carrier business, to Sun Capital Partners. The sale will allow SCS to focus solely on its Saia Motor Freight Line unit, a multi-regional LTL carrier. Bert Trucksess, SCS Transportation chairman and chief executive officer, said Jevic had not achieved acceptable levels of profitability for several years and was not core to the long-term goals of the company.
“Over the past several months, our board of directors, together with its financial advisor, Morgan Keegan, thoroughly and carefully evaluated a range of strategic alternatives with one goal in mind – to enhance value for all shareholders,” Trucksess says. “The board concluded that Jevic, which has not achieved acceptable levels of profitability for several years, is not core to the long-term direction of the company and that the sale of Jevic is in the best interests of the company’s shareholders.”
SCS will move its company headquarters from Kansas City, Mo., to Saia’s base in Duluth, Ga., and also plans to rebrand its corporate identity to Saia during the second half of 2006. “Given the company’s decision to focus solely on Saia’s operations, we believe that it makes strategic and financial sense to consolidate our corporate functions at Saia’s headquarters in Duluth, Georgia,” Trucksess says.
The company also announced that Trucksess will continue to serve as chairman and CEO through 2006, after which he will become non-executive chairman. Saia President Rick O’Dell was appointed president of SCS Transportation, effective immediately, and will succeed Trucksess as CEO; O’Dell, 44, also has been appointed to the company’s board of directors. In addition, Jim Darby will succeed Jim Bellinghausen, who is retiring, as vice president of finance and chief financial officer of SCS, effective Sept. 1. Darby, 55, previously served as Saia’s vice president of finance and administration.
“Rick O’Dell’s achievements and experience at Saia make him uniquely qualified to lead the company in its next phase of growth,” Trucksess says. “We are particularly indebted to Jim Bellinghausen for his substantial past contributions and outstanding performance. We will continue to benefit from his experience and support as we transition to a single segment company. I also want to welcome Jim Darby, whose six years of experience at Saia will be invaluable in his new role.”
The consolidation and sale of Jevic is expected to save SCS about $2 million in 2007. “We believe that as a private company, Jevic will be best positioned for a successful turnaround,” Trucksess says. “We are confident that the highly dedicated and hard-working Jevic employees, led by Dave Gorman and his management team, will continue to build and enhance the Jevic brand under new ownership.”