Clayton Dubilier & Rice Announces Merger of North American Van Lines and Allied Van Lines to Create Global Industry Leader
Combined company to maintain well-known brands and pursue growth initiatives
NEW YORK, September 14, 1999 -- Clayton, Dubilier & Rice, Inc. ("CD&R") and North American Van Lines, Inc. announced today a definitive agreement to merge North American Van Lines and Allied Van Lines in a transaction that will combine two of the world’s best known relocation and logistics companies. The merger will create a global industry leader with locations in 36 countries, including 1,100 agents in North America and worldwide revenues of more than $2 billion.
North American stated that it intends to maintain the high profile brand names of both companies, which are among the most recognized household, commercial and industrial brands in the world. The leading brands include North American Van Lines in the U.S. and Canada; Allied Van Lines in the U.S. and Canada; Pickfords in the U.K.; and Allied Pickfords in Europe, Australia and Asia. The combined company will be a market leader in relocations worldwide. It will be headquartered in Fort Wayne, Ind., and will maintain executive offices in Naperville, Ill.; London, England; and Melbourne, Australia.
The transaction, valued at $450 million, will create a more effective competitor in the household goods moving business and will strengthen North American's specialized transportation of high value products by permitting seamless service spanning the globe. Under the terms of the merger agreement, NFC plc [London Exchange: NFC], Allied's parent, will receive US $400 million in cash, approximately US $25 million in preferred stock and common stock representing approximately 20 percent of the capital stock of North American's parent company, NA Holding Corporation, plus warrants to acquire an additional 10 percent of the common shares outstanding. An investment fund managed by CD&R, management and agents will own the balance of the combined company.
James W. Rogers, a principal of CD&R, will serve as Chairman of the combined company and R. Barry Uber, North American Van Lines' President and Chief Executive Officer, will continue as the Chief Executive Officer of the company. Michael Fergus, the President and Chief Executive Officer of Allied Van Lines will continue to lead the Allied Van Lines business in the U.S. and Canada. Julian Nicholls will continue to head up the operations of Pickfords and all Allied Pickfords locations in Europe, and Kevin Pickford will continue to manage the operations of Allied Pickfords in Australia, New Zealand and Asia. A fund managed by CD&R purchased North American Van Lines from Norfolk Southern Corporation in March of 1998.
"The merger is a terrific strategic fit between two companies with complementary strengths and exceptional brand names," said Rice. "The combined company will have significant operational breadth and management depth," said Joseph L. Rice, Chairman of CD&R. "We are pleased that NFC shares our optimism about the prospects for this merger and will retain a significant equity stake in the new enterprise."
"Our new company will be a more effective competitor in global relocation services and logistics solutions with a passionate commitment from our family of associates, agents and drivers to high quality customer satisfaction," said Rogers. "We will aggressively pursue and invest for new growth opportunities. This merger provides us the opportunity to achieve market leadership, a challenging and rewarding work environment and strong financial performance. We will create real value for our customers, our investors and the many talented members of our agent, driver and associate network."
"We bring together two outstanding teams with an agent network unmatched in the industry," said Uber. "Our ability to deliver differentiated solutions to our customers will make us a powerful global competitor."
"We will have the size, scope and management leadership to provide the most innovative service offerings in the business," said Fergus. "I'm excited about the opportunities this merger provides for all of our stakeholders."
Clayton, Dubilier & Rice is one of the oldest and most respected private equity investment firms. With $4.5 billion of equity capital under management, the firm’s distinguishing characteristic is its focus on identifying and capturing operational improvements in its portfolio companies. In additional to operational improvements, CD&R has initiated major mergers and acquisitions for its portfolio companies. For example, in 1987, the firm created the Uniroyal Goodrich Tire Company by combining the tire businesses of the Uniroyal Tire Company and B.F. Goodrich. In 1994 the firm orchestrated the merger of Van Kampen Merritt Companies and American Capital Management to create an industry leading money management firm with $44 billion in assets under management. In 1998, the firm established Global Decisions Group, a financial and energy markets information provider, by combining McCarthy, Crisanti & Maffei and Cambridge Research Associates. Since its founding in 1978, CD&R has invested in 29 companies with aggregate annual sales of more than $20 billion, including such well known brand names as Kinko’s, Alliant Foodservice, and Lexmark International, among other leading companies. (http://www.cdr-inc.com/)
North American Van Lines is a recognized leader in the movement of household goods, specialized transportation of high value products and logistic solutions for individuals, corporations and government clients worldwide, with nearly $1 billion in annual revenue. Established in 1933, the company operates through a network of agents with more than 780 locations in the U.S. and Canada and 350 locations overseas. The company is headquartered in Fort Wayne, Ind., and currently employs approximately 3,200 people worldwide. The North American trademark is considered one of the most valuable brand names in the moving industry and, in independent research, the company consistently ranks among the top van lines in terms of brand recognition and customer satisfaction. In 1998, North American moved more than 440,000 shipments. North American is wholly owned by a fund managed by Clayton, Dubilier & Rice and by the management and agents of North American. (http://www.navl.com)
Established in 1928, Allied Van Lines is one of the oldest and most recognized names in the moving services industry with more than 550 agent locations in North America and representatives in more than 130 countries worldwide. Allied Van Lines' moving service business consists of Allied Van Lines, Pickfords, Allied International and Allied Pickfords. The company has a strong market position in international relocation. Pickfords is a market leader in the United Kingdom with the only national network. The company is headquartered in Naperville , Ill. and employs 4,000 people worldwide. (http://www.alliedvan.com)
NFC plc is a leading provider of supply chain services globally. Through its subsidiary, Exel Logistics, the company offers logistics and supply chain management services to its retail and manufacturing customers worldwide. (http://www.nfc.com) (http://www.exel.com)
For more information contact:
Valley Transportation Group
6652 W. Buckeye Rd.
Phoenix, AZ 85043