Freight Brokerage serving the Southwest
Mallard is a privately held, asset-based, over-the-road provider of truckload transportation for Fortune 500 companies over the last 30 years. The company’s well established reputation in the market operates 3 lines of business (Over-The-Road Dry Van/Dry Bulk 53%, Dedicated Dry Bulk 37%, and Freight Brokerage 10%) utilizing 230 late model tractors, 300+ trailers operated by Company Drivers, Lease-to-Own Drivers, and Owner/Operators. The company has a diversified customer/industry base which provides stability when different segments of the economy are up or down. The largest customer makes up around 25% of the overall revenue. Mallard’s 300+ employees operate from 5 different facilities.
Headquartered on 16 acres in Texas with offices and terminal, transload and terminal operations in New Mexico, and rented drop yards in Denver and Amarillo. The company has made significant investments in their focus on fuel economy and in technology such as McLeod’s Loadmaster TMS, Omnitracs, LytxDriveCam, Transflo and Veriwise/Asset Intelligence. The company has been E-Logs compliant since 2011 and maintains an excellent safety and claims ratings. Over the last 2 years, they have won 1st and 2nd place awards for Safety from industry associations and their insurance carrier. The company proudly claims they still haul freight for their very first customer.
Mallard has experienced a large increase in business over the last few years specifically by adding the DryVan division in 2013 and the Brokerage operation in 2014. A portion of the Dry Bulk business,representing $3M in Sales, was sold in early 2016 combined with unseated trucks and a temporary suspension of business by one dedicated haul customer in Q4 explains the decrease in 2016 Sales.
The retirement age founders own 33% of the company and are seeking to liquidate their ownership. The 2nd generation owners are currently operating the business and searching for a financial and operational partner to support the continued growth of the company. They would prefer selling 60-70% of the company and will consider a complete sale in the right situation.
Recruiting and retaining qualified drivers is the biggest challenge to this company. In 2016, they consistently had 30-40 unseated tractors at all times. Historically OTR drivers are out on the road 2-3 weeks at a time and make for the most challenging type of driver to find. In Q4, Mallard began the process of redefining their OTR model with a focus to get drivers back home 2 to 3 times per week.They are confident this will help with the driver shortage. The company is also focused on building the brokerage portion of the business and overall business is expected to pickup with the economy in 2017.
The ideal buyer should be experienced in the transportation industry and have a desire to partner with the management team to improve the operational and financial results of the business. Once the overall business is stabilized, an add-on acquisition strategy especially around the higher margin business is desired.