Schneider National Inc., the largest privately held trucking company in the U.S. by revenue, plans to buck current trends in the freight industry and pursue an initial public offering next year.
Even as its competitors are bedeviled by weak demand caused by an inventory glut, the Green Bay, Wis., company said in a statement that it would go public in a bid to expand.
The company scored $3.4 billion in revenue in 2015, placing it $1.3 billion ahead of Estes Express Lines, its nearest private competitor, according to SJ Consulting Group. Schneider is the seventh-largest trucking company in the country, offering a range of options including truckload and intermodal delivery, brokerage services and more.
Al Schneider founded the firm in 1935, and it has been family-owned ever since. Executives are seeking the IPO “to facilitate continuity of controlling ownership of Schneider by the future generations of the Schneider family, while continuing forward with its long-standing independent and professional corporate governance structure,” they said in a statement.
But in a rough economic environment, most of Schneider’s rivals have opted to seek financing through private equity firms or by selling to or merging with other companies. Trucking stocks have been uneven. Schneider’s revenue slipped 2.9 percent year over year in 2015, according to SJ.
The last major American trucking IPO was in 2010, when Swift Transportation Co. raised $766 million issuing 73.3 million shares. Recently, though, Wall Street has seen glimmers of interest, with Chinese logistics firm ZTO Express Co. filing for a U.S. IPO in July.
Schneider has not yet filed a registration statement with the U.S. Securities and Exchange Commission and hasn’t indicated when it plans to issue shares. The IPO is “subject to satisfactory market conditions,” the company said.
But Schneider, which has more than 10,000 trucks and 33,800 trailers, intimated that it wants to grow its business. As more consumers turn to e-commerce, traditional truckers are trying to muscle past retailers’ in-house transportation services to get a share of the so-called last mile sector, which involves deliveries direct to consumers.
In June, Schneider took over Watkins & Shepard as well as Lodeso Inc., both specialists in unconventional and late-stage shipments. The IPO will allow the company “to maintain and further investments in its long-term positioning,” Schneider said.