Arizona Firm Purchases Control of Cannon Express
by June 9, 2003 12:00 am 104 views
Bruce Jones, CEO of Cannon Express Inc., left the Springdale firm May 29 after control of the truckload carrier was sold a day earlier by founders Dean and Rose Marie Cannon to a group called Arizona Diversified Equity LLC.
John W. Pacheco, president of Arizona Diversified, was named chairman and CEO of Cannon Express during a May 28 board meeting. Jim Schnoes, a Bentonville resident and the firm’s former treasurer, is its new president.
Details of the private transaction were not available. But the Cannons owned 60 percent of the company with 1.93 million shares, or about $1.35 million worth, after the May 28 close at 70 cents per share.
Jones was president of CFOex, a Knoxville, Tenn., firm hired last August to lead a corporate turnaround at Cannon, which has experienced 11 straight quarters of losses.
Schnoes, who is vice president and managing director of CFOex, said Jones’ departure was really just a “transition.”
“CFOex was hired to assist in a turnaround as part of a 12-month deal,” Schnoes said. “We’re nine months into that deal, and we believe we’ve accomplished three important goals. We’ve built a very solid management team. We’ve reestablished Cannon’s name in a more focused, 30-state area, and we’ve addressed some serious financial issues.”
Schnoes said Cannon will continue to operate as an independent, publicly traded firm. He said it plans to grow revenue through a series of acquisitions but could not disclose any possible buyout targets.
The company’s stock topped $15 per share in late 1994 but hasn’t traded above $1 since April 2002.
Former outside directors Sam Fiser and Glenn Kelley resigned from Cannon Express’ board, and chief financial officer Duane Wormington will remain in that capacity.
Cannon Express, founded in 1981, had 151 local staffers and another 474 employees nationwide in May. Traded publicly on the American Stock Exchange after dropping from Nasdaq in 1998, Cannon Express was notified on Nov. 15 that it had fallen below that market’s minimum performance requirements to remain listed.
On April 30, the exchange accepted a proposal by Cannon Express that aims to get the firm’s finances and operations in order by May 30, 2004. The firm saw its losses increase 67 percent from $7.3 million ($2.28 per share) for 2001 to $12.2 million ($3.81 per share) last year.
Cannon has 616 tractors, although many are tagged to be sold, and about 1,100 trailers.