CH Robinson Worldwide Inc. agreed to buy trucking brokerage firm RXO Inc. in a deal valued at about $5.8 billion, bolstering the combined companies’ logistics operations at a challenging time for the freight industry.
RXO shareholders will receive $17.25 in cash and 0.0856 shares of CH Robinson for each RXO share they own, for an implied consideration of $30.25 a share, the companies said on October 5 in a statement. That represents a 29% premium to RXO’s closing price on October 2.
RXO shares jumped 21% as of 7:29 a.m. in premarket trading on October 5 in New York, while CH Robinson fell 4.9%.
Through the deal, which is expected to close in the first half of 2027, CH Robinson aims to diversify its business and capitalize on RXO’s abilities in expedited and last-mile delivery. The purchaser intends to use artificial intelligence to improve operations and realize $300 million of cost savings within two years.
The shipping business is grappling with heavy costs, including record high diesel prices. The merger also comes shortly after a Supreme Court ruling earlier this year that has sent shockwaves through the trucking brokerage market by opening them to lawsuits if a driver for a contracted carrier gets into a collision.
CH Robinson said it will finance the cash portion of the deal with new debt financing, and it has entered into a fully underwritten commitment for a bridge facility with Morgan Stanley Senior Funding Inc. RXO shareholders are expected to own 11% of the combined company upon closing.
Morgan Stanley acted as the financial adviser to CH Robinson, and Goldman Sachs served as financial adviser to RXO.
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