GXO is reportedly exploring a sale, which would potentially put the $6 billion logistics services provider in the hands of a new owner.
Bloomberg first reported on the possible transaction Wednesday, saying that the Greenwich, Conn.-based company began to review its options after receiving interest from potential buyers. GXO is working with financial advisers on the deal to field the interest, with a Reuters report indicating that suitors include rival logistics providers.
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No final decision has been made and GXO could opt to remain independent, the report said.
Sourcing Journal reached out to GXO.
In Thursday morning trading, GXO’s shares shot up more than 14 percent on the report. Company stock has largely disappointed throughout the duration of the freight recession, in which overall freight and warehousing demand has declined since pandemic-driven early-to-mid 2022 peaks. GXO hit a high stock point at $101.04 per share on Nov. 19, 2021, ahead of 2022’s logistics bear market, since declining more than 42 percent.
Although GXO has recently touted more than $300 million in new contract wins for 2025, revenue growth for the contract logistics provider has been fueled largely by its acquisitions in recent years.
The company had a 2 percent organic revenue bump in its second quarter, with much of its total 19 percent revenue bump to $2.8 billion coming from its $965 million acquisition of U.K.-based logistics services company Wincanton. When GXO reported earnings in August, UBS said the 2 percent organic revenue growth is “indicative of GXO’s business momentum continuing.”
The organic growth outpaced the 1 percent increase in the quarter prior, but the first two quarters are thus far undershooting the company’s initial 2024 guidance, which called for organic growth of 2 percent to 5 percent.
Organic revenue growth increased 2.3 percent throughout 2023 to $9.2 billion, with deals pushing total revenue growth up 8.7 percent to $9.8 billion.
Net income for GXO in the second quarter was $39 million.
Regardless of financial results, GXO was more upbeat in its August earnings call, with CEO Malcolm Wilson saying it is seeing continental Europe- and U.K.-based customers “grow more confident and launch new and larger projects,” which “bodes well for our future growth.