In ‘growth mode regardless of market conditions,’ NTG acquires Eagle Transportation

“The teams met 10 years ago at TIA in 2009 and have always respected each other,” said Kevin Nolan, NTG founder and executive chairman. “Eagle adds incredible resources and expertise in the refrigerated freight brokerage sector as well as depth in our existing management team.”

As part of Eagle’s integration with NTG, Eagle President Tory Bass and Vice President Brad Payne will both become vice presidents of brokerage at NTG.

“The customer base of both companies is extremely diversified, and there is very limited overlap between our customer bases, which is one of the reasons the transaction is so exciting for both teams,” Payne said. “Eagle has deep relationships with large enterprise customers as a result of their differentiated capabilities in refrigerated brokerage. NTG will benefit from these relationships and Eagle’s enterprise sales capabilities.”

Regarding the mergers and acquisitions market in non-asset freight brokerage, the prevailing narrative has been that the collapse of the trucking spot market in early 2019 impaired many brokerages’ top-line revenue growth, compressed multiples and in general made deals easier for buyers.

As one of the freight brokerage industry’s most prominent examples of the private equity-backed roll-up, NTG/TI has invested in building out permanent M&A capabilities within its organization. Nine months ago it hired Jones Pharr as senior vice president of corporate development and M&A. Pharr came with 14 years of deal-making experience at BlackArch Partners, a middle-market investment bank in Charlotte, North Carolina, and Bank of America Merrill Lynch.

“The M&A market for freight brokerages is still active, especially for brokerages with specialized capabilities,” Pharr said. “Eagle received substantial inbound interest and NTG feels they are very fortunate to be selected as a partner.”

As for 2020, Eagle officials said that they expected an improving environment for rates as the year progresses, but Kevin Nolan affirmed that NTG’s strategic growth plans would be pursued independent of the trucking cycle.

Bass said, “Capacity is exiting the market and we’re expecting enhanced rates as a result, but as a combined team we’re ready for anything.” 

Nolan added, “We are in growth mode regardless of market conditions.”

More deals are in the pipeline for NTG in 2020, the management team guided.

“We are always evaluating acquisition opportunities,” Pharr said. “We have invested heavily in our M&A capabilities and feel that organic growth and growth through acquisitions are both important. We are actively expanding our M&A team and pursuing additional acquisitions in 2020 and beyond.”

Eagle management spoke to the all-important culture fit as part of the process of selecting a buyer. Companies targeted for acquisition by roll-ups want to know that growth capital will be invested in their businesses and that existing team members will have even better opportunities in a combination.

Bass discussed what attracted his team to NTG.

“It starts with relationships — we have a strong cultural fit with NTG, care deeply about our company and have a shared passion for excellence,” Bass explained. “NTG has made commitments to us in the areas of recruiting, development and new teammates to help us accelerate growth and deliver more for our customers. Eagle will also benefit from NTG’s extensive investments in technology and thousands of customer and carrier relationships.”