The Brink’s Co. is planning to sell its BAX Global operating unit – an international logistics and express parcel firm that competes with FedEx and United Parcel Service – for approximately $1.1 billion in cash to Deutsche Bahn AG. Net proceeds after taxes and expenses related to the transaction are expected to be approximately $900 million, said Michael Dan, chairman, president & CEO of Brink’s.
“The sale of BAX Global represents an … opportunity … to join with an industry leader that is committed to being a major long-term player in the field of freight transportation and logistics,” he said. “The combination of people, industry expertise, geographical strength and customer-service focus should benefit BAX Global employees and customers worldwide.”
The BAX sale also marks an important financial and strategic turning point for Brink’s, he added, as it plans to focus entirely on security-related services. “We expect to use at least $200 million of the net proceeds from the sale to provide funding for the VEBA, the financing vehicle for the company's legacy retiree medical costs, reduce debt levels and fund future growth. We also anticipate using from $400 million to $600 million for a significant return of capital to shareholders through share repurchases.”
BAX Global, headquartered in Irvine, CA, generated $2.4 billion in revenue last year offering supply chain management and transportation solutions for business-to-business shippers through a global network of nearly 500 offices in 133 countries. Its specialty is managing the movement of heavyweight packages and cargo of all shapes and sizes, primarily for the aerospace, automotive, hi-tech, retail, and health care industries.