LOGISTEC Stevedoring Inc., a subsidiary of North American marine and environmental services provider LOGISTEC Corporation, announced it has entered into a definitive agreement to acquire the Canadian and U.S. marine terminal business of Fednav, including Federal Marine Terminals, Inc. (FMT) and the logistics division, Fednav Direct, for a purchase price of US$105 million, subject to customary adjustments.
FMT has operated terminal facilities at ports in Canada and the United States for over five decades. It provides stevedoring, handling and warehousing services for bulk, containerized, project cargo, and general cargo. FMT also offers value-added on-carriage services, inventory management, and 24/7 inland cargo transportation in Canada and the United States. For the year ended December 31, 2022, FMT generated revenue of US$89.8 million with gross margins comparable to LOGISTEC’s marine segment.
The addition of 11 terminals expands LOGISTEC’s network total to 90 terminals in 60 ports across North America.
“We are delighted to welcome FMT to continue to grow together across Canada and the USA,” said Madeleine Paquin, President and CEO of LOGISTEC. LOGISTEC and FMT have had a long-standing business relationship for decades and joining forces is a natural fit, as we share the same values. The combined capabilities and expertise of both organizations will create solid synergies to deliver operational excellence to marine shippers across North America.”
“LOGISTEC, a company with cargo handling as its core business, will ensure FMT’s ongoing success and growth, stated Paul Pathy, Fednav’s CEO and President. “In the coming years, Fednav will focus on its pure-play shipping business and continue its expansion journey. Known to innovate and provide the highest standard of service for over 75 years, Fednav has an exciting new chapter ahead.”
“As part of LOGISTEC’s ambitious strategic plan to expand its marine services both geographically and operationally, this acquisition will allow us to gain a footprint in new markets in Canada and the USA,” said Rodney Corrigan, President of LOGISTEC Stevedoring Inc. “Our customers will benefit from a large and efficient network, as well as strong expertise from the FMT team, and together, we will continue to offer quality service to contribute to a safe, reliable supply chain.”
The transaction is expected to close on or about March 31, 2023, subject to customary closing conditions. The transaction will be financed via an increased CA$450 million revolving credit facility, which has been fully underwritten by BMO Bank of Montréal and TD Securities.
TD Securities is acting as sole financial advisor to LOGISTEC in connection with the transaction and Fasken is LOGISTEC’s legal counsel.