Dealmakers are concerned on how supply chain issues and market volatility will effect middle-market M&A. And of course, whenever there’s a problem in a industry it spells a business opportunity for someone. Angeles Equity Partners found a pocket of the logistics sector that is still holding up well.
The PE firm recently announced a deal to buy a majority stake in Oklahoma City-based Freymiller. The target offers refrigerated transport and freight brokerage services to support cold chain management. Angeles says Freymiller has an advantage over most other transportation companies.
“Supply chain logistics have seen increasingly tight capacity and increased freight rates that stemmed from Covid and have continued as a result of a tight driver market, increase shipping demand, and higher fleet values,” Sam Heischuber, principal at Santa Monica, Calif.-based private equity Angeles tells Mergers & Acquisitions. “The refrigerated trucking space is a specialized niche within the market and commands higher rates than commodity dry vans. In addition, given that Freymiller hauls food & beverage, as opposed to consumer discretionary goods, the business has and should continue to remain much more stable.”
Labor shortages are adding to mounting global supply chain problems, but that isn’t slowing Freymiller down. “Given the company’s long-tenured experience in the space, late-model fleet, and industry-leading driver retention programs, the company has been able to increase its driver count over the last several years. In addition, the company has a strong and fully-dedicated new driver recruiting department,” Heischuber adds.
You have to love the optisim.
– Demitri Diakantonis
