Daseke to Be Publicly Traded
KEY BISCAYNE, Florida — Daseke Inc. will become a publicly traded company on Feb. 28, costing $10 per share, which will raise capital for more acquisitions during 2017, the company announced at the Stifel 2017 Transportation & Logistics Conference here in Key Biscayne, Florida.
Daseke will trade under the ticker symbol “DSKE” on the Nasdaq in a merger with Hennessy Capital Acquisition Group Corp. II. Don Daseke, chairman and CEO, told Transport Topics that going public will allow his company to reward employees for success. Daseke management will own about 50% of the total shares, and Hennessy about 35%.
“We have more than 3,000 people in the company, and the only real way to issue the new shares was to become a public company. We have stock incentives for all of our employees,” he said.
Daseke, 77, who agreed to a three-year lockup of his stock, hopes to double the existing business during the period. The company seeks mergers and acquisitions of open-deck carriers with annual revenue between $40 million and $200 million, already identifying more than 100 companies with at least 200 open-deck trucks.
Daseke believes the multitude of M&As, when completed, would add $643 million in annual revenue and $100 in adjusted earnings before interest, taxes, depreciation and amortization.
“Looking back, we had $5 million in adjusted EBITDA in 2009 to nearly $90 million now. So we feel confident that, with the additional capital, we can hit our targets and double the size of the company by the end of 2019,” Daseke said.
Chief Financial Officer Scott Wheeler told TT that “it’s absolutely the plan” to use the capital to execute multiple M&As in 2017, although the company solicits “not for sale” carriers rather than be approached by others.
Daseke’s stockholders before Feb. 28 also can receive up to 15 million in stock awards if it reaches annual targets of $140 million in adjusted EBITDA and $12 per share before the end of 2017; $170 million and $14 per share at the end of 2018; and $200 million and $16 per share in 2019.
According to FTR research, open-deck freight was a $133 billion market in 2016 and will grow to $174 billion by the end of 2019. Daseke owns less than 1% of the “highly fragmented market,” Daseke said.
“[FTR research is] pointing to a significant increase in industrial production, but we don’t believe the FTR numbers accounted for a major infrastructure spend that could come out of the White House or an increased effort to keep manufacturing in the United States,” Wheeler said. “We think it’ll be a very solid 2017.”
Hennessy Capital Chairman and CEO Daniel Hennessy and President Kevin Charlton will join the Daseke board of directors. Hennessy told TT that he views himself as a fiduciary. He also told an audience at the Stifel conference that an industrial renaissance is well under way in the United States, including infrastructure and nonresidential construction.
“There are some groups out there that like to do a deal, then move on to something else, but we’re committed to Daseke and to its success. We view ourselves as long-term investors,” he said.
Daseke ranks No. 44 on the Transport Topics Top 100 list of the largest U.S. and Canadian for-hire carriers. Trucking companies in the Daseke family include E.W. Wylie, Central Oregon Truck Co., Lone Star Transportation and Bulldog Hiway Express.
