Frozen Food Express Acquisition
Duff Brothers Capital Corporation will offer to acquire all of the outstanding shares of common stock of FFE.
"For over a year, we have been reviewing a variety of strategic alternatives for FFE, which included exiting less profitable businesses, such as dry van truckload services, entering into the bulk tank water transportation business, and re-engineering our LTL services with technology enhancements that further differentiate our service offerings in the marketplace," said Russell Stubbs, president and CEO of FFE. "As part of this process, we were pleased when the Duffs expressed an interest in FFE. We believe the value of this transaction achieves our objective of delivering immediate and compelling value for our shareholders. Through the Duff's ownership of KLLM, they have demonstrated a strong track record in the trucking industry, which will be beneficial to our customers, vendors, employees and drivers."
On behalf of James and Thomas Duff, Thomas Duff stated that, "We are excited about the opportunity to add another leader in the temperature controlled trucking industry to our family group of businesses. With the synergies and increased capacity that we can gain from the ownership of both FFE and KLLM, we know that we will be able to enhance the quality service that both companies have been providing to their customers. With our resources, we will be able to bring to FFE the financial strength that is needed to preserve and expand its operations for its valued employees for years to come. Overall, we see great things ahead for both of the companies."
Under the terms of the merger agreement, FFE's stockholders will receive $2.10 in cash for each outstanding share of FFE common stock they own, representing a 23.5% premium over the closing price on July 12, 2013, the last full trading day before today's announcement, a 26.5% premium over the closing price on March 1, 2013, the last full trading day before the announcement that the Duffs had acquired approximately 5.84% of the outstanding shares of common stock of FFE and expressed an intent to discuss with FFE a negotiated acquisition and a 144.2% premium over the closing price on December 18, 2012, the last full trading day before the Duffs began open market purchases of FFE shares with a view towards accumulating a significant position.
The transaction is expected to close by late August or early September 2013.