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Frozen Food Express Industries, Message Board

  • denn56k denn56k Mar 15, 2013 7:25 PM Flag

    Will Duff merge FFEX and KLLM.....

    To become a public company?.....KLLM is also reefer but not a route LTL operation....A merger would save by dropping duplicate back office support, management, facilities and gain from increase buying power for everything from tires-parts-insurance-trucks-trailers etc, higher utilization of facilities....Would they keep the 2 brands?...Trucking companies usually do, for some reason...Just like the large dry carriers, Swift and JB, size matters......This may be the beginnng of a reefer trucking roll-up.....I believe FFEX is bait and its only a matter of what fish takes it....maybe Duff, maybe someone else, but FFEX is bait.......

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    • it's a possibility. just remember that KLLM was a public company until it went BK. Duff bought it and took it private, Is it profitable now? I don't know. The buying power that you suggest is not possible. Federal franchise laws forbid price breaks from one dealer to the next from buying for less from the manufacturer. All dealers pay the same price for their trucks and trailers. As for savings on tires? Doubt it. An LTL operation requires facilities. In this case refrigerated terminals. I've got some breaking news for you, JB didn't make their money from their trucking operations. Swift didn't have such a good year either. Large doesn't necessarily mean better. what it does mean however is higher cost that needs to be covered. YRC only recently became profitable and they don't get much bigger than that. And just for thought, how would you know that Duff isn't acting as the white knight to discourage another company from coming in to take FFEX? Just a thought.

      • 2 Replies to r0476ed
      • btw....I wish I did not make money in trucking like JB doesn't.

      • You might have to sell the exact 10,000 tires at the same price from one dealer to the next but you certainly can sell 20,000 tires at a less cost/per tire to someone...There will be many advantages, with redundancy savings and cost reduction associated with workers comp, HC etc.......Duff put FFE in play....Certainly there are many others that will show interest in FFE.....with approx 1400 trucks and $400 mil/yr rev. and with the economy turning around this will grow substantialy...I also assume that the stubby's will enter the mix if the offers seem inadequate, yet they will not gain the savings that other trucking companies will in acquiring FFE....Its going to be hard for the stubbs to give up control so I would not be surprised to see them top any bids recieved.....and they have all the money they siphoned from FFEX at their disposal.............There is nothing more I would love to see than the stubbs lose control...its only fair....they deserve it...they have treated FFE as a personal piggy-bank for decades.....

 
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