J.B. Hunt to buy Zenith Freight Lines for $87 million
by January 31, 2022 9:26 am 1,711 views
Lowell-based carrier J.B. Hunt Transport Services Inc. announced Monday (Jan. 31) plans to acquire the assets of Conover, N.C.-based less-than-truckload carrier Zenith Freight Lines LLC for $87 million as the company continues to expand its final mile delivery of bulky items.
Zenith is a subsidiary of Bassett, Va.-based furniture manufacturer Bassett Furniture Industries Inc., which has 96 company- and licensee-owned stores. The deal to purchase Zenith from Bassett is expected to close by Feb. 28.
“This investment enhances J.B. Hunt’s furniture delivery capabilities by expanding our nationwide, end-to-end supply chain solution for our customers, and we look forward to establishing a long-term connection with Bassett, a manufacturer and retailer of high-quality home furnishings and a leader in the industry,” said John Roberts, president and CEO of J.B. Hunt.
Zenith posted revenue of $87 million in the fiscal year that ended November 2021, and Bassett represented one-third of its business. J.B. Hunt will use its existing cash balance for the acquisition.
“The sale of Zenith opens an exciting new chapter in our quest to provide the highest level of service to our customers,” said Robert Spilman Jr., chairman and CEO for Bassett. “Disruption caused by the pandemic aside, we believe that the consolidation of traditional specialized furniture transportation is inevitable. As discussions with J.B. Hunt progressed, we came to understand the benefits that the scale of J.B. Hunt could provide in terms of equipment, technology, driver recruitment, intermodal transportation and warehousing density. In addition, we developed a healthy respect for the management team and their operating culture. We are extremely enthusiastic about the potential to better serve our customers with the 50-year accumulated furniture transportation know-how of Zenith in combination with the power of the J.B. Hunt platform.”
Zenith was founded by Jack and Debbie Hawn and provides less-than-truckload transportation services for furniture manufacturers and retailers in the United States. Zenith moves products from manufacturing points or import locations using employee drivers, late-model equipment and about 1 million square feet of warehouse space to complete more than 250,000 deliveries annually. According to a news release, the founders are expected to transition to key roles with J.B. Hunt to ensure seamless integration with minimal impact on daily service.
“The sale of Zenith to J.B. Hunt represents the culmination of our life’s work in the furniture transportation industry,” said Jack Hawn, president of Zenith. “Becoming a part of J.B. Hunt will advance the quality service we have established by providing scalable, efficient solutions to the furniture industry.”
The acquisition will expand J.B. Hunt’s Final Mile Services segment, which operates one of the largest nationwide, commingled cross-dock operations, the release shows. The segment comprises 116 locations and more than 3.5 million square feet of warehouse and facilities space.
Since 2017, J.B. Hunt has purchased carriers that transport bulky items such as furniture and fitness equipment. This will be the fifth acquisition to expand its final mile segment. In November 2020, J.B. Hunt acquired the assets of fitness equipment hauler Mass Movement Inc. In 2019, J.B. Hunt acquired the assets of RDI Last Mile Co. and Cory 1st Choice Home Delivery. It purchased Specialized Logistics Dedicated in 2017.
“Zenith’s reputation in the furniture industry and their focus on quality customer service extends our model to be the best final mile provider in North America,” said Nick Hobbs, chief operating officer, executive vice president and president of contract services for J.B. Hunt. “We are excited to welcome the employees and customers of Zenith to J.B. Hunt.”
Shares of J.B. Hunt (NASDAQ: JBHT) were trading Monday at $191.45 down 45 cents or 0.23%. In the past 52 weeks, the stock has ranged between $133.36 and $208.87.