J.B. Hunt Transport Services announced Thursday it will acquire the brokerage operations of BNSF Logistics, a subsidiary of BNSF Railway.
BNSF Logistics provides a full suite of 3PL services through employees and agents. J.B. Hunt (NASDAQ: JBHT) is acquiring the truckload, drayage, expedited and less-than-truckload platform. BNSF Logistics will retain the portion of the business that handles warehouse, specialty retail, heavy-haul and project-related services.
Financial terms of the transaction were not provided.
“As we continue to work with BNSF Railway to develop solutions that drive value for customers, we recognized a unique opportunity to combine the companies’ efforts to serve the transportation market with 3PL services and leverage the investments J.B. Hunt has made in our technology platform, J.B. Hunt 360,” stated J.B. Hunt CEO John Roberts in a news release.
BNSF is J.B. Hunt’s sole intermodal partner on the West Coast, a relationship that dates back to 1989. The companies agreed to work together to significantly expand intermodal capacity last year.
J.B. Hunt has a plan in place to grow its container fleet to 150,000 units in the next two to four years. It has also been adding transloading facilities near the coasts.
BNSF opened a new rail hub capable of 50,000 container lifts annually at the Port of Tacoma in Washington. It now provides direct container service with J.B. Hunt between the port and Chicago.
“This agreement with J.B. Hunt reflects our companies’ shared commitment to provide industry-leading intermodal service to our customers,” said Katie Farmer, president and CEO at BNSF. “This continues more than 30 years of partnership between BNSF and J.B. Hunt and builds on our announcement to further integrate our joint services.”
The transaction is expected to close by the end of the year and will be funded with cash on hand. At closing, the two companies will enter a long-term service agreement wherein the newly acquired operations will continue to perform 3PL services for BNSF Railway (NYSE: BRK.B).
The business will be rolled into J.B. Hunt’s Integrated Capacity Solutions unit.
“Complemented with our best-in-class intermodal and J.B. Hunt 360box power-only service offering, this acquisition will provide a compelling value proposition for customers, growth opportunities for J.B. Hunt and greater service capabilities for BNSF Logistics’ employee and agent model,” said Brad Hicks, J.B. Hunt’s president of highway services.
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