XPO Spinoff GXO to Go Public Aug. 2
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GXO Logistics will sell shares to the public for the first time Aug. 2 on the New York Stock Exchange, executives said during an investor day presentation July 13.
XPO Logistics Inc. has been working for nearly a year to spin off the global contract logistics operations into its own publicly traded company.
“The spinoff will establish GXO as the largest pure play logistics company with around 5% of the $130 billion of logistics that’s currently outsourced in our key geographies,” said Malcolm Wilson, CEO of the GXO business. “We will be the second-largest contract logistics company in the world.”
Wilson
“GXO has a broad geographic presence that allows us to meet the needs of our global customer base,” Wilson said. “Importantly, our scale makes us one of only a handful of global players that can satisfy the logistics requirements of the world’s largest multinational companies.”
Wilson said the new company can support more than 200 million square feet of warehousing space across nearly 900 locations worldwide and close to 100,000 workers.
GXO was first registered with the U.S. Securities and Exchange Commission on June 9.
Mark Manduca, who will become GXO’s chief investment officer, told Transport Topics the day after the presentation there was a real appreciation in the market.
“The feedback so far has been extremely strong. We’re very grateful to have phenomenal investors, obviously as part of core XPO, who were extremely supportive. So feedback so far has been good.”
This spinoff that’s taking place now is creating two powerhouse companies.
Malcolm Wilson, CEO of GXO
Manduca said the main area of debate has been the valuation. The process of determining the value of the company will take place over the next few weeks.
“The opportunities for a business that has revenues of around $8 billion is phenomenal going forward,” Manduca said.
Manduca
He highlighted during the investor day presentation how the logistics company uses a collaborative approach, bringing together sales, implementation and technology expertise to provide solutions tailored to a customer’s current and anticipated needs. He also noted contract terms gives the company outstanding revenue visibility in the near and medium term. Some recent contracts even extend into the five- to 10-year range.
The GXO executives finished the presentation focused on projected growth, cash flow, where there are scale opportunities and the benefits of having the contract logistics operations become its own company.
“This spinoff that’s taking place now is creating two powerhouse companies,” Wilson said. “It allows us to implement our own optimal capital structure, investment identity, the resources, allocation of strategies.”
XPO Logistics ranks No. 2 on the Transport Topics Top 50 list of the largest logistics companies in North America and No. 3 on the Transport Topics Top 100 list of the largest for-hire carriers.
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