Ryder System Inc. has become the target of a takeover bid by Miami-based private equity firm HG Vora Capital Management, at a proposed price of $86 per share, a 28.4% premium to its 30-day average, according to an SEC filing, with Ryder’s stock surging in response.
At the start of the day, Ryder had a market capitalization of about $3.65 billion, and HG Vora’s bid values it at about $4.4 billion. The acquisition would be funded out of $250 billion in funds managed by the company and an “alternative investing manager,” according to the filing. HG Vora, with $7 billion in assets under management, holds 5 million shares of Ryder stock.
“The proposed acquisition is subject to, among other things, [HG Vora’s] satisfaction with the results of due diligence regarding the financial outlook of the Fleet Management Solutions, Supply Chain Solutions and Dedicated Transportation Solutions businesses, as well as the evaluation of relevant commercial, legal, accounting and tax matters,” the company said in its filing.
In a letter to Ryder’s board from principal and founder Parag Vora, the company expects to complete its due diligence in 60 days.
Ryder has been making a major push into ecommerce fulfillment and delivery in recent years, with a technology focus, making it an attractive target. Earlier this year it acquired 3PL Whiplash, which itself has been investing in robotic fulfillment. Whiplash has 19 facilities included dedicated and multi-client warehouses totaling nearly seven million square feet.
And last fall, Ryder acquired Midwest Warehouse & Distribution Systems, which has 17 warehouses and a strong presence in the greater Chicago area. Before both acquisitions, Ryder had 63 million square feet of space in its supply chain network.
Around the same time as the Midwest acquisition, Ryder participated in an $85 million funding round benefitting autonomous vehicle technology firm Gatik. That company’s technology will power autonomous middle mile deliveries for Ryder’s retail and ecommerce clients in the Dallas-Fort Worth area, initially equipping 20 leased Ryder box trucks for the purpose.
Last month, both Ryder and Gatik participated in a panel discussion on autonomous vehicle technology in the middle mile for ecommerce and retail replenishment, at Ecommerce Operations Technology Summit 2022 in Orlando.