Forward Air Corporation (NASDAQ:FWRD) today announced that it has acquired Total Quality, Inc. (TQI), a premium provider of maximum security and temperature-controlled services to the pharmaceutical and life science industries.
Headquartered in Grand Haven, MI, TQI had 2012 revenues of approximately of $54.8 million. The purchase price was $66 million (or approximately 8x TQI’s 2012 adjusted EBITDA) plus an earn-out of up to $5 million based upon TQI’s performance in 2013 and 2014. TQI was acquired on a cash free, debt free basis with an adjustment for working capital. The transaction will be funded by Forward Air’s cash reserves and is expected to be accretive to its 2013 earnings.
Founded in 1992, TQI utilizes industry-leading temperature–controlled equipment, 24-hour real-time monitoring and tracking technology, and layered security features and practices to provide its customers with a level of service that is unmatched in the industry today. In addition to its core pharmaceutical services, TQI also provides truckload and less-than-truckload brokerage transportation services.
Terry Fewless, founder and President of TQI, said: “We are extremely excited to join the Forward Air team. We feel that TQI and Forward Air are a great fit, as each company truly values providing best-in-class service levels to its customers. This is a necessary and logical next step for TQI. Forward Air will be able to provide us with the perfect mix of resources, structure and industry expertise necessary to capture our growth potential, while not sacrificing our customer commitment to provide high quality service.”
Bruce A. Campbell, Chairman, President and CEO, said, “We are very excited about the acquisition of TQI. Our team has looked at a number of acquisition opportunities over the last few years only to have them eliminated from consideration due to core customer channel conflicts, high levels of asset intensity or inferior margins and returns. None of those hurdles exists with TQI.”