XPO Logistics founder: We are seeing the 'mother' of all demand peaks this holiday season
XPO Logistics (XPO) founder Brad Jacobs is a busy, busy guy right now.
“We are seeing the mother of all peaks,” Jacobs told Yahoo Finance Live on the current state of business this holiday season as e-commerce orders boom.
The holiday season will see Jacobs not only trying to meet the frenzied pace of online demand, but also crunching the numbers on a breakup of his company.
XPO said Thursday evening it will pursue a spinoff of its logistics operation into a separate publicly-traded company. The decision ends a nearly year’s long effort by Jacobs to explore strategic alternatives. It was a process that initially kicked off in January as Jacobs believed XPO was being grossly undervalued relative to industry peers such as Old Dominion and C.H. Robinson that haven’t performed as well as his company.
The review process was halted in March, however, due to volatile market conditions amid the COVID-19 pandemic.
After the transaction is closed in the second half of 2021, Jacobs will lead XPO’s transportation business as CEO. Existing management at the logistics business will remain in place. Jacobs will serve as chairman for both companies. XPO’s logistics business is the second largest contract logistics company in the world, boasting about 200 million square feet of warehouse space.
The break-up is a change of pace for the dealmaking Jacobs.
Jacobs primarily built XPO Logistics through acquisitions. He purchased a whopping 17 companies in a stretch from 2011 (when XPO Logistics was founded) to 2015. The company hasn’t made an acquisition since the 2015 purchase of trucking company Con-way for $3 billion.
Instead, since 2015, Jacobs has sought to invest aggressively in XPO Logistics’ last-mile delivery capabilities to become an even more integral partner to major retailers shipping items from online. He has further boosted investments in robots to speed up freight unloading and technology to better schedule employee work hours.
Brian Sozzi is an editor-at-large and anchor at Yahoo Finance. Follow Sozzi on Twitter @BrianSozzi and on LinkedIn.
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