Transport and logistics giant UPS is selling its freight business to Canadian-based transport and logistics company TFI International for US$800 million.
UPS says the decision to sell its freight business was based on a “better not bigger” strategic positioning.
UPS and TFI International will also enter into an agreement for UPS Freight to continue to utilise UPS’ domestic package network to fulfill shipments for a period of five years.
“We’re excited about the future and the opportunities this creates for both UPS and UPS Freight as part of TFI International,” UPS chief executive Carol Tomé says.
“The agreement allows UPS to be even more laser-focused on the core parts of our business that drive the greatest value for our customers.”
UPS Freight has been operating for over 85 years and is one of the largest less-than-truckload (LTL) carriers in the US, offering a full range of regional and long-haul solutions.
The transaction is subject to closing conditions and regulatory approvals and is expected to close during the second quarter of 2021.
UPS expects to recognise a non-cash, pre-tax impairment charge of approximately $500 million on its statement of consolidated income for the year ended December 31, 2020.
