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CNF Inc., Palo Alto, CA, has entered into a definitive agreement with UPS under which UPS will purchase CNF's Menlo Worldwide Forwarding business for $150 million in cash, plus the assumption of approximately $110 million of debt. The purchase includes Menlo Worldwide Forwarding's air and ocean forwarding operations in more than 175 countries, its North American services and facilities, its operations hub in Dayton, Ohio, Menlo Worldwide Expedite! and Menlo Worldwide Trade Services.
Not part of the transaction are Menlo Worldwide Logistics, Menlo Worldwide Technologies, Vector SCM or Con-Way Transportation Services, all of which continue to be owned and operated by CNF.
CNF said it would recognize an after-tax loss on the sale of Menlo Worldwide Forwarding, formerly named Emery Worldwide, of approximately $260 million, subject to adjustments at closing. The company also said it would reschedule its planned Oct. 18 third-quarter earnings announcement and will present results on the basis of continuing and discontinued operations.
ﾑ'CNF will be in its best financial condition in 15 years,'' said W. Keith Kennedy, CNF chairman and interim CEO. ﾑ'We will have an excellent balance sheet, with a strong cash position. We are strengthening our business and serving the best interests of our shareholders, while enabling Menlo Worldwide Forwarding to join with one of the premier brands in the transportation industry.''
Bob Stoffel, UPS senior vice president, Supply Chain Group, said, ﾑ'This acquisition is an ideal strategic and operational fit. Menlo Worldwide Forwarding is a well-established global air freight forwarder, with international trade capabilities ﾖ all of which complement UPS' existing operations.''
Menlo Worldwide Forwarding has been part of the Menlo Worldwide operating group of companies since 2001. It employs more than 8,000 people around the world and had gross revenues in 2003 of $1.9 billion.
Menlo Worldwide includes the operations of Menlo Worldwide Forwarding, Menlo Worldwide Logistics, Vector SCM, Menlo Worldwide Technologies, Menlo Worldwide Expedite! and Menlo Worldwide Trade Services. The Menlo Worldwide companies employ more than 12,000 people. They provide global supply chain services including air freight, ocean freight, logistics management, critical expedited transportation, supply chain consulting and technology and customs brokerage and other trade services in more than 175 countries.
CNF is a $5.1 billion management company of global supply chain services with businesses in regional trucking, air freight, ocean freight, customs brokerage, global logistics management and trailer manufacturing.