St. George Logistics, a portfolio company of Wind Point Partners, has acquired Extra Express, a division of Dicom Transportation Group which is also a portfolio company of Wind Point. St. George Logistics was acquired by Wind Point and logistics operating executives Chris Jamroz and Hessel Verhage in September 2016 from LongueVue Capital and Ironwood Capital.
Founded in 1982, the Extra Express division of Dicom provides warehousing and delivery services to blue-chip accounts throughout California. Extra Express, located near Los Angeles in Brea, CA, operates four warehouse facilities and has a network of more than 300 delivery vehicles (www.extraexpress.com).
According to Wind Point, St. George will leverage Extra’s operating capabilities to introduce local last mile delivery services across its network, which includes 32 facilities totaling over five million square feet of space. St. George will launch last mile delivery services in California in May 2017 and plans to establish last mile services at other port and inland facilities later this year.
“The last mile delivery segment is a critical component of the import supply chain and our customers spend over $100 million annually on third party transportation providers who visit our facilities, pick up products, and make individual deliveries to the final recipient,” said Mr. Jamroz. “The acquisition of Extra will allow us to relieve our customers of a substantial operational burden by offering a closed-loop solution that is faster, cheaper, and more technologically integrated with our other services.”
St. George is a provider of container freight station (CFS) services for ocean and air cargo imported into the United States. The company also provides logistics services, including contract warehousing, distribution, e-commerce fulfillment and transportation services. The St. George customer base includes freight forwarders, neutral NVOCCs (non-vessel operating common carriers), retailers, consumer packaged goods companies, and other businesses. The company is headquartered near Newark in South Kearny, NJ with additional facilities located in the nation’s largest ports and metropolitan areas, including Los Angeles, Houston, Chicago, Atlanta, Savannah and Charleston (www.stgusa.com).
Dicom is a provider of business-to-business regional, expedited ground transportation services across the United States and Canada. The company operates one of the largest regional ground transportation systems in North America, managing a network of approximately 2,000 delivery vehicles and 55 facilities. Dicom was acquired by Wind Point in March 2014 and is headquartered in Montreal (www.dicomexpress.com).
“This is an exciting transaction for both St. George and Dicom. St. George will add last mile as a critical component to its full line of import/export services, which was identified as a core strategic priority at the time of our acquisition of the company,” said Konrad Salaber, a Principal with Wind Point. “Dicom, meanwhile, has the opportunity to focus its resources on its core footprint, which has emerged as one of the largest regional ground transportation networks in North America.”
Dicom’s transportation networks generate approximately 50% of its sales in the eastern half of Canada, 45% of its sales in the eastern half of the US, and 5% of its sales in California. “Extra is an exceptional business with an impressive track record of growth. However, given Dicom’s success in establishing one of the continent’s leading regional ground networks in the eastern half of North America, Extra’s operations in California have become non-core to our strategy,” said Scott Dobak, CEO of Dicom.
Raymond James was the financial advisor to St. George and Barclays was the financial advisor to Dicom. Antares Capital, LStar Capital, and NewStar Financial provided financing for the transaction.
Wind Point invests from $20 million to $70 million of equity in companies with revenues from $100 million to $500 million and EBITDAs of at least $8 million. Industries of interest include business services, consumer products, healthcare and industrial products. Wind Point Partners was founded in 1984 and is based in Chicago (www.wppartners.com).
© 2017 Private Equity Professional | May 10, 2017
