Carrier giants Swift Transportation (No. 4 on the CCJ Top 250) and Knight Transportation (No. 24) announced Monday morning the two companies will merge, pending the closing of a deal later this year.
The all-stock merger has been approved by both the Swift and Knight boards. Following the merger, the companies will be known as Knight-Swift Transportation Holdings Inc. and will trade on the New York Stock Exchange under the ticker symbol KNX. As of closing of the NYSE Friday, Knight was trading at $30.65 a share, and Swift was trading at $20.02 a share.
Current Swift shareholders will own 54 percent of the company, while Knight shareholders will own the remaining 46 percent. There will be just one class of shares with equal voting power for each share, according to the merger agreement.
“Indeed, by coming together under common ownership, the companies will be able to capitalize on economies of scale to achieve substantial synergies,” says Swift Chairman Richard Dozer. “This is an exciting chapter in the Swift story and everyone who is a part of it should be both proud of what we bring to the table and excited about what lies ahead. I am confident in this new team, in the new structure and in the future of Swift in the industry.”
According to the deal, each Swift share will be converted into 0.72 shares of the new company’s stock through a reverse stock split. Each Knight share will be exchanged for one share of the new company.
Knight-Swift’s board of directors will consist of all of Knight’s directors and four of Swift’s. Jerry Moyes, founder of Swift, will serve as a non-employee director and senior advisor to the executive chairman and vice chairman. Moyes’ family will own approximately 24 percent of the company.
The leadership team will consist of Kevin Knight, executive chairman; Gary Knight, vice chairman; David Jackson, CEO; and Adam Miller, CFO.
“Under this ownership structure, we will be able to operate our distinct brands independently with experienced leadership in place,” says Knight CEO Kevin Knight. “We look forward to learning from each other’s best practices as we seek to be the most efficient company in the industry. We are dedicated to a seamless transition and ensuring continuity for our customers and professional driving associates.”
In 2016, Swift reported just over $4 billion in revenue, and Knight reported $1.1 billion in revenue. The merger is expected to close in the third quarter of this year, subject to regulatory approvals and closing conditions.