Why Yellow’s trucking terminals are attracting billion dollar bids
Why Yellow’s trucking terminals are attracting billion dollar bids
As Yellow is sold for parts in bankruptcy court, one group of assets is getting all the attention: Its terminals.
These are large logistical facilities where payloads are transferred between trucks to get to their final destinations — they’re a little like regional hub airports, the ones where you might have a layover.
They’re where all the deliveries come in, are consolidated into one load of things going in the same direction.
And they’re more valuable than you might think, not to mention expensive to build from scratch. So much so that two rival trucking companies have submitted bids, each over $1 billion dollars, for Yellow’s network of terminals.
“It’s sort of like a collector’s collection all of a sudden hit the market,” said David Corell, a research scientist at MIT.
And the collection is a good one. Many of these terminals are in or near metro areas where regulations make it difficult to build new terminals now, said Margaret Kidd, a supply chain and logistics professor at the University of Houston.
“You can’t just go into a major metropolitan area in most parts of the U.S. and create what Yellow has created over the last 100 years,” Kidd said.
The two companies currently bidding for Yellow’s full collection of terminals likely won’t need all of them, said Joe Orscheln, a vice president at commercial real estate firm CBRE.
“Some of these would certainly be spun off after the acquisition,” he said. And when they are, he said, they’ll likely find plenty of eager buyers.
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