Uber Freight acquires logistics firm Transplace for $2.2B
Uber Freight on Thursday said it's paying $2.25 billion to acquire Transplace, a company that makes logistics software. Uber will acquire Transplace from TPG Capital, the private equity platform of alternative asset firm TPG, which took over Transplace in 2017.
Once the deal closes, Uber says it will have one of the largest managed transportation and logistics networks in the world. The deal should also help the Uber business segment speed up its path to profitability.
Uber Freight is a relatively small segment of Uber, but it is growing quickly. During Uber's last-reported quarter, the business segment brought in $301 million in revenue, up 51% year-over-year. Its adjusted EBITDA was negative $29 million. The business segment is expected to hit adjusted EBITDA breakeven in the fourth quarter of 2022.
Transplace, meanwhile, is EBITDA profitable and is expected to generate more than $100 million in 2021. One to two years after the close of the transaction, Uber Freight expects to see net run-rate synergies surpassing $40 million.
Uber says the transaction will allow Uber Freight to serve substantially more customers at all levels of the freight industry, and it will expand its presence into Mexico.
"This is a significant step forward, not just for Uber Freight but for the entire logistics ecosystem," Lior Ron, head of Uber Freight, said in a statement. "This is an opportunity to bring together complementary best-in-class technology solutions and operational excellence from two premier companies to create an industry-first shipper-to-carrier platform that will transform shippers' entire supply chains, delivering operational resilience and reducing costs at a time when it matters most."
Frank McGuigan, CEO of Transplace, added that the deal will "significantly reduce shipper and carrier empty miles to the benefit of highway and road infrastructures and the environment."