NEW FACTORS IMPACT VALUATION IN STORAGE, SUPPLY CHAIN AND FULFILLMENT WAREHOUSING & FULFILLMENT | FEBRUARY 2021
3 WAREHOUSING & FULFILLMENT New Factors Impact Valuation in Storage, Supply Chain, and Fulfillment
TABLE OF CONTENTS INDUSTRY TRANSFORMATION
Industry Transformation For many decades, third-party storage, whether dedicated or public, was an The Covid-19 Effect underappreciated segment of the supply chain with valuation EBITDA multiples Key Trends & Drivers in the mid-single digits and few marquee transactions to make headlines. However, awareness of the significance of warehousing started to germinate in What Buyers Are Looking For in 2021 the 1980's with the introduction of lean manufacturing philosophies and just-in- Valuation Estimates time inventory capabilities driven by computer software advances. Notable M&A Transactions Large manufacturers began to outsource their supply chain to streamline Public Company Transaction Update operations as speed to market and inventory turnover became key metrics for Public Company Comparisons financial analysts. Third party warehousing was a cost-effective way to position Q&A With NFI product with much great flexibility and became the default pathway for getting product to retail locations. With the turn of the millennium, an even larger Select Transactions paradigm shift would emerge, that of online transactions and ultimately the Report Contributors wholesale migration of consumers from brick-and-mortar retail to shopping Firm Track Record from home.
Well, what does this really mean for warehousing? Basically, all the “operational” functions of a store, like storing product, sorting product, packaging product and servicing the product shifted from a retail location to a warehouse location. So much of that fulfillment responsibility and customer experience value handled by stores, are rapidly transferring to the warehouse, or “fulfillment center.” This shift has large implications for the perceived value of category (now called fulfillment services) and therefore transaction values of third-party storage companies. CONTACTS Retail E-Commerce Sales Worldwide Burke Smith Managing Director $10,000 505-690-3561 [email protected] $8,000 6,542 Jay Mercier 5,695 $6,000 Vice President 4,927 404-934-6362 4,206 3,535 [email protected] $4,000 2,982 2,382 Nathan Feldman 1,548 1,845
U.S. Dollars in BillionsU.S. Dollars in $2,000 1,336 Associate 845-416-5906 [email protected] 2014 2015 2016 2017 2018 2019 2020E 2021E 2022E 2023E
Source: Statista www.capstoneheadwaters.com 2 Warehousing & Fulfillment | February 2021
THE COVID-19 EFFECT
Online shopping has accelerated during the pandemic and heightened demand for e-commerce fulfilment services. As a result, and with this trend expected to continue over the next few years, acquisition activity in the Fulfilment sector has also accelerated and brought heightened valuations for companies that provide the infrastructure to make e-commerce possible.
While e-commerce giants such as Amazon (Nasdaq:AMZN) have seen a jump in revenue, rising from $75 billion in Q1 2020 to over $125 billion in Q4, small and medium-sized enterprises (SMEs) have also shifted their strategies to an online focus. This trend can be seen in Shopify’s (NYSE:SHOP) impressive revenue jump in Q2, rising from $470 million in Q1 to $714 million in Q2. Traditional brick and mortar retailers have taken notice. After its acquisition of Jet.com in 2016, Walmart (NYSE:WMT) has been actively pushing into e-commerce and is top of mind for CEO Doug McMillon, who stated:
“Our omnichannel strategy, enabling customers to shop in seamless, flexible ways, is built for serving the needs of customers during this crisis and in the future.” 3
The most telling part of this statement is “in the future,” which signals that the largest retailer in the world understands that these changes are not going away. This omni-channel distribution requirement is putting significant pressure on large third- party warehousing and supply chain companies which service the consumer space. The choice is either invest in upgrading existing facilities to handle omni-channel or seek acquisitions and partners to manage online orders.
E-Commerce Fueled Multiple Expansion
Revenue TEV/Revenue $800 70x
$700 60x
$600 50x
$500 40x
$400
30x $300 U.S. Dollars in MillionsU.S. Dollars in TEV/Revenue Multiple 20x $200
10x $100
$0 0x Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
2015 2016 2017 2018 2019 2020
Source: Capital IQ, multiples are an average for the quarter; Shopify Q2 2020 Earnings Transcript
3 Warehousing & Fulfillment | February 2021
KEY TRENDS & DRIVERS: DISTRIBUTED FULFILLMENT NETWORKS
Shopify introduced its fulfillment network plan in 2019 with a stated total capital investment of $1 billion to build out its own distribution infrastructure. This vertical integration strategy is meant to drive shippers to use their software platform exclusively. Other companies are taking the opposite approach by remaining agnostic to the e-commerce platform and leveraging the tens of thousands of existing local and regional warehouses in the U.S. Several meaningful attempts at developing national scale fulfillment platforms have emerged in the last five years, primarily to service smaller independent brands that market directly to consumers. Valuations of these companies, which have raised significant venture capital, tend to be much higher than the warehousing companies doing the fulfillment work, on the promise that their platforms can aggregate large order volumes from thousands of smaller shippers.
The idea is also catching on with very large strategics like UPS (NYSE:UPS), which launched its own independent subsidiary Ware2Go in 2018. There is a ferocious land grab for customer accounts and warehousing partners to service these accounts. For warehousing companies that have underutilized capacity or are looking to shift from storage to fulfillment models, there are some benefits to partnering with platforms that can deliver significant volume, as well as potential valuation premiums for their own businesses. The question remains whether the unit economics of partnering justifies the required investment in technology, racking/binning/sorting, and additional staffing.
Headquarters: Chicago, IL Headquarters: Seattle, WA
Capital Raised: $130 million Capital Raised: $144 million
Valuation: $568 million Valuation: $100 to $500 million
Key Investors: Softbank, Menlo Ventures, Key Investors: Activate, Madrona, Tiger Bain Capital Global, T. Rowe Price
Locations: 9 domestic fulfillment Locations: Claims 1,000+ warehouse 2 international partners with various service Adding partner locations levels
Headquarters: San Francisco, CA Headquarters: Los Angeles, CA
Capital Raised: $70 million Capital Raised: $15 million
Valuation: $210 million Valuation: $40 million
Key Investors: 9Yards, Alumni Ventures Key Investors: Canvas Ventures
Locations: Claims 3,000+ warehouse Locations: Claims 1,000+ warehouse partners with various service partners with various service levels levels
Source: Pitchbook, Crunchbase and Company Interviews
4 Warehousing & Fulfillment | February 2021
WHAT BUYERS ARE LOOKING FOR IN 2021
Over the past few months, we have spoken with dozens of larger supply chain companies about their acquisition plans for 2021. While there are always company specific factors which weigh more heavily with specific buyers, four characteristics regularly emerge as important differentiators for prime acquisition targets. Based on the interest level of buyers, we expect that 2021 should be an active transaction year as companies adjust to the post-COVID supply chain environment.
Technology Integration Value Added Services
• Fast EDI implementation • Picking and packing • E-commerce connectivity • Custom packaging & delivery options
Value added services does not just apply to fulfilling You don’t have to have your own team of e-commerce orders. Think about how your programmers to have a successful technology operation can streamline your customers’ supply capability. Most buyers are looking for efficient EDI chain process. Activities like custom sorting and implementation as the highest priority. It should not packaging, wrapping and printing can help make take months to onboard a new customer that wants your company more valuable to customers and to transact electronically. Beyond EDI, your WMS acquirers. Even commodity and B2B storage should be capable of handling connectivity to third companies need to think about omnichannel party software platforms like Shopify, Magento, Big distribution models. The needs of one customer Commerce (Nasdaq:BIGC), Amazon, and others. most likely apply to a spectrum of potential new Advanced fulfillment processing and automated customers and are typically worthy of strategic connection to transportation and delivery providers investment. are other technology hot-buttons for buyers.
Footprint and Scalability Transportation Revenue
• 500k+ overall capacity • Parcel management or last mile delivery • Multi-market presence • Brokerage capability
Acquisition transactions, take considerable financial Storage provides a solid base for warehouse and personnel resources to execute and buyers operation but does not offer the transactional wanttomakesuretheyarespendingtimewhere revenue opportunities that buyers are looking for. the impact is greatest. This generally means that Operators with e-commerce customers can often more focus is placed on scale, targets with more insert a service charge for connecting with parcel capacity and transaction volume. Larger buyers will delivery providers like UPS and Fedex (NYSE:FDX). want to bring their own customer accounts into an Other transportation revenue services include acquired warehouse, so some room to grow is arranging LTL transport or even inbound logistics, certainly a plus if not access to new space. particularly for smaller shippers. Some larger Additionally, while some buyers are looking for very warehouses also successfully integrate drayage specific locations on the map, acquisition candidates services or last mile delivery on a captive or owner with a bigger footprint are usually more appealing. operator basis.
5 Warehousing & Fulfillment | February 2021
VALUATION ESTIMATES: MIDDLE MARKET STORAGE AND FULFILLMENT COMPANIES
11-13x 6-7x EBITDA Multi-state company with 10+ facilities Regional players with 1-3 warehouses >75% B2C revenue with control of transportation spend Minimal B2C business, low transport Automated order flow with leading e-commerce aggregators spend revenue Fortune 500 and growth customer mix Minimal technology integrations, still 10%+ revenue growth largely manual 10%+ EBITDA margins Mostly smaller SMB customers with higher-than-average churn 3%-5% revenue growth 3%-7% EBITDA margins
15x+ Pure play software platform with 8-10x revenue share warehouse partners Multi-state company with 5-10 facilities National network coverage of major 50%+ B2C revenue with significant transportation population centers spend revenue 20%+ annual account growth Robust TMS with connectivity capability to e- 90%+ B2C order flow commerce platforms Control of transportation spend 5%-10% revenue growth 25%+ revenue growth 5%-8% EBITDA margins Profitable model
NOTABLE M&A TRANSACTIONS
2020 2019 2020 Clearly a vertical integration statement for The Whiplash acquisition was about Big Box supply chain has become its own the shipping giant looking to build a software to grow e-commerce fulfillment. animal. CHR realized that consolidation presence in the US retail and e-commerce Now PLG is looking to scale the network services are critical to cost effectively manage distribution space. and customer base. lots of shippers with the same endpoints.
2020 2019 and 2020 2018 Hub Group wanted a leading position in retail Dot Family Holdings wants to replicate Korea based CJ Logistics saw an opportunity consolidation and did so with the acquisition of its success in food distribution within the to dramatically expand its US network as it Case Stack. The asset lite platform leverages e-commerce logistics space. Its seeks to fulfill its ambition to become an Hub’s own footprint to more rapidly gain scale acquisition of Tagg and LeSaint creates a international logistics leader. The transaction and market coverage. formidable network to service the was a notable marker for international branded retail and omnichannel market. interest in the US supply chain sector. 6 Warehousing & Fulfillment | February 2021
PUBLIC COMPANY TRANSACTION UPDATE
On December 2, 2020, XPO (NYSE:XPO) announced that its board of directors has unanimously approved a plan to pursue a spin-off of its logistics business unit that would result in XPO shareholders owning stock in both companies. XPO intended to structure the spin-off as a transaction that is tax-free to XPO shareholders. XPO Logistics will retain the freight transportation business which consists of LTL and non-asset freight brokerage. NewCo will be the second largest contract logistics company in the world with ~200 million square feet of warehouse space.
XPO Logistics Sees Stock Rise after Spin-Off Announcement
The equity market reacted favorably to the corporate announcement and the stock price moved higher with approximately four million shares changing hands on the first day of trading after the 8-K was released. Volume Stock Price
$125 5 The plan to pursue a $120 spin-off is announced 4 after the market close. $115 3
$110 2 U.S. Dollars
$105 1 VolumeMillions in
$100 0
2020
Source: XPO Logistics 8-K Published 12.02.20 & Capital IQ
“By uncoupling our transportation and logistics segments, we intend to create two high-performing, pure-play companies to serve the best interest of all our stakeholders. Both businesses will have greater flexibility to tailor strategic decision making and capital allocations to their end-markets, with the benefit of strong positioning as customer-focused innovators. We currently believe that this spin-off is the most effective way to unlock significant value for our customers, employees and shareholders.”4 - Brad Jacobs, Chairman and Chief Executive Officer of XPO Logistics
As standalone companies, the freight transportation and contract logistics businesses will probably have a higher combined equity market valuation (sum-of-the-parts) than what is currently being reflected in XPO Logistics’ market capitalization. The board of directors want to unlock shareholder value and discard the “Conglomerate Discount” that weighs heavily on the stock price of the company.
Company Rationale for the Spin-Off:
The companies will have the ability to focus on their specific strategic priorities and customer requirements Provide additional differentiation by having its technology team focus on enhancing proprietary software developed for its specific service offering The investor base will be aligned with a clear-cut value proposition and be properly valued by the investment community Each busines would have a better opportunity to attract and retain world-class talent by offering meaningful equity-based compensation that correlates closely to performance Separate public stock listing would enhance each company’s ability to purse accretive M&A opportunities, with the benefit of an independent equity currency at a potentially higher value.
7 Warehousing & Fulfillment | February 2021
PUBLIC COMPANY COMPARISONS: CONGLOMERATE VS. “PURER” PLAY
Warehousing & E-Commerce Fulfillment XPO Logistics Prologis Clipper Logistics 40x 35x 30x 30.2x 25x 20x
EV/EBITDA 15x 10.4x 10x 5x 7.8x 0x 2018 2019 2020 2021
Less-Than-Truckload XPO Logistics SAIA Old Dominion Freight Lines 25x
20x 20.1x
15x 14.9x
10x EV/EBITDA
7.8x 5x
0x 2018 2019 2020 2021
Freight Brokerage XPO Logistics C.H. Robinson Echo Global Logistics 35x 30x 25x 18.0x 20x
15x 14.7x 10x EV/EBITDA 5x 7.8x 0x 2018 2019 2020 2021
Source: Capital IQ
8 Warehousing & Fulfillment | February 2021
Q&A With NFI
Capstone Headwaters spoke with TJ Lynch, Senior Vice President of Finance and Marketing at NFI, to discuss their views on the evolution of e-commerce fulfillment, NFI’s warehousing and fulfillment businesses, and the M&A industry as it relates to logistics.
NFI is a fully integrated North American supply chain solutions provider headquartered in Camden, N.J. Privately held by the Brown family since its inception in 1932, NFI generates more than $2.6 billion in annual revenue and employs over 14,500 associates. NFI owns facilities globally and operates more than 50 million square feet of warehouse and distribution space. Its dedicated fleet consists of over 3,000 tractors and 12,500 trailers operated by 3,000 company drivers and leveraging partnerships with 400 owner operators.
How has NFI evolved over the past five years with the rapid ascension of e-commerce?
Over the past five years, within our network our distribution centers have transformed into omnichannel facilities. What we were shipping from our warehouses to distribution centers, we are now shipping from our warehouses to distribution centers, stores, and direct to consumers. Furthermore, we are processing more returns with respect to e-commerce because a large percentage of what is shipped to consumers ultimately gets returned. Consumers are buying multiples of items with the goal of keeping one and sending the remainder back to the shipper. We are doing a lot more processing of returns within our warehouses and fulfillment centers.
What are some of the challenges that have been created by consumer demand for faster delivery times?
Thechallengeweareseeingisthatshippers’networkshavebeendisrupted.Thelargershipperswhohaveastoreformatare trying to figure out how to change that store format into a combo store/fulfillment center. For small to mid-size shippers, 2020 was a very difficult time for them, especially if they did not have an e-commerce solution. What we saw was that the big got bigger and the small to medium size shippers struggled to compete.
As a 3PL, we are working very hard with shippers to determine if those distributions centers are located in the appropriate places in order to cut down on transportation costs and to improve speed to market. The truncation of time from two-day to same day delivery has challenged shippers with how to balance inventory on hand (holding costs) versus making sure that they have enough inventory to avoid a stockout in a specific location. A missed sale or getting a product a few days late for a lot of these retailers is unacceptable because consumers are going to move on to the next best retailer.
How has NFI positioned itself to grow its market share of e-commerce fulfillment in North America?
We continue to be bullish on warehousing and e-commerce fulfillment. What we have been doing to position ourselves over thepastfewyearsistoinvestinbothtechnology and engineering. NFI has invested in the tier-one warehouse management systems, yard management systems and labor management systems. We feel that we have some of the best technology in order to tap into shippers and to provide them with the visibility that they demand.
The second thing is that we have grown our engineering group and our utilization of robotics and automation. We have talented engineers that work side by side with our shippers to lay out distribution centers to optimize efficiency between automation and labor. Lastly, something that might be unique to NFI as a 3PL is that we have a large real estate competency. We feel that with our competency in real estate, we can see where shippers want to be located and can get out ahead of this need with flexible solutions.
9 Warehousing & Fulfillment | February 2021
Q&A With NFI (CONTINUED)
Do you see any trends, or shift, in the value-added services that your customers expect as their fulfillment provider?
We are seeing more of an each-picking environment that entails a lot more in terms of labeling, tagging and/or co-packing.
The second area of value-added service is reverse logistics but it depends on the shipper and how they handle reverse logistics. There are a lot of retailers and apparel companies whose returns are going back to one of our distribution centers or warehouses.
Then you must decide on what to do with these products. Do you put it back in inventory, scrap it, or wholesale it? We spend a lot of time thinking about how to process those returns in the most efficient and effective way to maximize value of returned products when they come back into our warehouses and fulfillment centers.
Could you provide some color or thoughts on the M&A market as it relates to warehousing and fulfillment? Do you expect the market to remain hot in 2021?
I see 2021 as being a very good M&A market for logistics in general and specifically warehousing and fulfillment. There is a larger emphasis on having agile supply chains and 3PLs will fair well because of that.
Our M&A strategy mainly focuses on founder-owned or family-owned business. These owners went through a lot this past year and many of them might be thinking about a liquidity event if they do not have a succession plan in place. NFI wants to be involved with family-owned reverse logistics companies located in logistics hubs. There are a lot of good companies, with NFI being one them, that had great 2020s because of their alignment with essential customers. Reverse logistics is a concept that is moving quickly. This will be a focus area of NFI and we love warehousing and fulfillment and will continue to look for good deals out there that will add some size, scale, and industry specializations to our portfolio. We are focused on logistics businesses located in the United States and Canada.
TJ Lynch has been with NFI since 2010 and leads corporate finance functions including financial planning and business analytics, mergers and acquisitions, certain administrative functions, and special projects. In addition, TJ oversees NFI’s marketing efforts which focus on business line sales support, brand awareness, digital marketing, and corporate events such as the Customer Advisory Board.
Prior to joining NFI, TJ was a Senior Manager in the Transaction Advisory Services Group at Ernst & Young, where the practice focused on financial diligence for mergers and acquisitions. At E&Y, TJ advised large public companies, private equity firms, and middle market companies in the US, Canada, and Europe.
Contact Mr. Lynch at [email protected]
10 Warehousing & Fulfillment | February 2021
SELECT TRANSACTIONS
Enterprise EV / LTM Date Target Acquirer Target Business Description Value (mm) Revenue EBITDA
Offers reverse logistics services, including returned 01/28/21 Recommerce Group Cannagistics Inc. --- return center services, and remanufacturing.
Ridgemont Equity Provider of transportation, logistics, forwarding, and 01/07/21 SEKO Worldwide --- Partners warehousing services.
Moulton Logistics Provides fulfillment, retail distribution, promotional 12/23/20 Amware Fulfillment --- Management distribution, and mailing services.
Stellex Capital Provides warehousing and distribution services in 12/10/20 Weber Logistics --- Management addition to drayage, consolidation, and transload.
Provider of third-party logistics and transportation 12/09/20 NonstopDelivery Hub Group, Inc. $94.5 -- services.
Engages in the distribution of toys, games, and other 11/12/20 Optimum Fulfillment Flat River Group --- consumer products. Visible Supply Chain Operates as a logistics and fulfillment company 07/07/20 TriCon --- Management headquartered in Dallas. Provides warehousing, fulfillment, and fulfillment 04/28/20 BGS Fulfillment NovEx Supply Chain --- services. Fulfillment Services Comprises a business division that offers warehousing 03/20/20 Ruby Has --- of EasyPost to receiving, pick-packing, and shipping services. Offers warehousing, transportation, home delivery, 03/17/20 Innovel Solutions Costco Wholesale $998.0 - - freight/carrier and end-to-end custom solutions. Offers last-mile delivery, dispatch, simple and complex 03/02/20 NAL Group CRST International --- installation, warehousing, and direct fulfillment services.
Offers fulfillment and e-commerce solutions for retail, 02/19/20 Performance Team A.P. Møller - Mærsk $545.0 1.0x 6.1x wholesale, and omni-channel customers. RPM Consolidated Odyssey Logistics & Offers freight forwarding, storage, warehousing, trans 01/30/20 --- Services Technology loading and cross docking and fulfilment services. Prime Distribution C.H. Robinson Provides warehousing, cross-docking, packaging, and 01/28/20 $222.7 2.1x - Services Worldwide multi-vendor freight consolidation services. All Assets Of Sid The Chefs' Comprises specialty food products fulfillment business 01/27/20 Wainer $50.5 - - Warehouse in the Northeast. & Son Advantage Media Offers third party fulfillment, returns processing, reverse 01/21/20 EchoData Services --- Services logistics, and inventory management solutions. Offers supply chain, inventory, and warehouse 01/14/20 LeSaint Logistics TAGG Logistics management along with transportation and fulfillment --- services. Greenbriar Equity Provides webtracking, e-Commerce, warehousing and 01/07/20 Air-City Group; SEKO --- distribution, and pick and pack services. Enterprises Provides transportation, and warehousing and 12/03/19 Veeco Holdings STG Logistics --- fulfillment services in the US.
Milan Supply Chain Wellspring Capital Specializes in truckload transportation, logistics, 09/18/19 --- Solutions Management warehousing/storage consolidation, and fulfillment. Assets of Great Jet Mail Services, 08/20/19 Lakes Fulfillment Assets offer fulfillment services. --- Incorporated Services
06/20/19 Fusion Transport Hudson Hill Capital Offers logistics services. ---
Advantage Media Provides third party warehouse management, order 05/07/19 Fort Point Capital --- Services management, and fulfillment services. Source: Capital IQ, PitchBook, FactSet, and Capstone Research 11 Warehousing & Fulfillment | February 2021
SELECT TRANSACTIONS (CONTINUED)
Enterprise EV / LTM Date Target Acquirer Target Business Description Value (mm) Revenue EBITDA
Whiplash Port Logistics Provides storage and shipping services for products on 04/24/19 --- Merchandising Inc. Group demand for e-commerce companies. International Offers complete front end e-commerce shipping Rakuten Super 03/26/19 Fulfillment solutions and integrated e-commerce fulfillment --- Logistics Solutions/ IFS360 services. The Related 03/13/19 Quiet Logistics Companies; Provides e-Commerce fulfillment services. --- Greenfield Partners Offers distribution and fulfillment, contract packaging, Harkness Capital 03/13/19 Kane Logistics cross docking, and transportation management Partners --- solutions. DSI Warehouse & Provides storage, pick up and packaging, assembling, 01/14/19 Houston-Johnson --- Storage kitting, container handling, and fulfillment.
Provides fulfillment, warehousing, order processing, 12/12/18 FulfillPlus Balwa Group --- kitting, assembly, and shipping services.
Offers integrated logistics solutions to retailers and 11/05/18 CaseStack Hub Group $252.1 1.0x 11.5x CPG companies.
Sunteck Transport Offers trucking, forwarding, supply chain, warehousing 10/09/18 HA Logistics --- Group and fulfillment services.
Iron Mountain 10/02/18 Amware Fulfillment Provides marketing production and fulfillment services. --- Fulfillment Services
Provides third party logistics services for mid-sized 08/31/18 TAGG Logistics Dot Family Holdings --- healthcare and consumer products businesses. New Age Evans Delivery Offers third-party freight, warehousing, and 06/11/18 Transportation and --- Company fulfillment services. Warehousing Provides logistics and supply chain 06/07/18 DSC Logistics CJ Logistics $240.1 0.4x - management services.
Provides last-mile e-commerce delivery solutions 04/16/18 Lasership Greenbriar Equity --- through an integrated hub-and-spoke network .
Provides logistics services for home delivery and retail 04/03/18 MXD Group Ryder System $120.0 - - replenishment.
Provides production line support, inventory 03/23/18 Trinity Logistics Agrisolutions --- management, warehousing, and fulfillment services.
International Transactions
07/17/20 Mobiltron France Cordon Electronics Offers e-commerce logistics services. ---
ASAP Log Soluções 04/27/20 VVLog Logística Provides logistics services to e-commerce businesses. --- em Logística
Rhenus Provides international freight forwarding, warehousing, 01/08/19 CML --- Warehousing multichannel fulfillment, and value-added services.
Aramex Global Offers logistics, transportation, and shipping services 12/18/18 Australian Postal $33.3 - - Solutions for the e-commerce industry.
09/07/18 Alpha Direct Services Hopps Group Offers E-commerce logistics solutions. - - -
Provides warehousing, response handling, fulfilment, 09/04/18 S&H DSV Panalpina --- and returns handling. Source: Capital IQ, PitchBook, FactSet, and Capstone Research 12 Warehousing & Fulfillment | February 2021
TRANSPORTATION & LOGISTICS TEAM
Burke Smith Managing Director, Head of Transportation & Logistics [email protected] | 310-872-0038
BurkeistheHeadoftheTransportation&LogisticspracticeatCapstoneHeadwatersandisbasedinthe Denver office. Burke joined the firm in 2014, bringing to Capstone Headwaters 19 years experience as an advisor to or leader of middle market companies. Most recently, Burke ran several asset-based trucking and warehousing operations, and previously managed an 8-state last mile delivery network. Over his career to date, Burke has executed more than 45 transactions with a combined value in excess of $40 billion. Burke began his career working on Wall Street. He initially trained at Wasserstein Perella & Co., where he worked directly for famed M&A banker Bruce Wasserstein. Burke then joined Donaldson, Lufkin & Jenrette (DLJ) as an early member of the firm’s Exclusive Sales Group, which became one of the most successful middle market sell-side advisory practices on Wall Street. Following the acquisition of DLJ by Credit Suisse, Burke joined UBS as an Executive Director in the mergers and acquisitions group. Burke earned a Law degree from Harvard Law School, and an MA and BA from Stanford University.
Jay Mercier Vice President 404-934-6362 | [email protected]
Jay serves as a Vice President in Capstone Headwaters’ Transportation & Logistics coverage group. He brings over 10+ years of capital markets experience that spans investment banking, credit trading and equity derivatives trading. Prior to joining Capstone Headwaters, Jay worked as a Director at Cowen where he was a member of the Outsourced Trading Team. He was responsible for the account coverage of institutional buy-side accounts and advised clients on risk mitigation strategies with the use of exchange-traded derivatives. Jay earned a BA from the University of Georgia and an MBA from the Georgia Institute of Technology.
Nathan Feldman Associate 845-416-5906 | [email protected]
Nathan joined Capstone Headwaters in 2015 and while he has held multiple different roles at the firm, he currently works as an investment banking Associate on the firm’s Transportation & Logistics team. His responsibilities primarily include helping middle market business owners throughout the industry execute exit, recapitalization, and capital raise transactions.. Nathan earned his BA from Brandeis University with a degree in English, Business and Physics.
2020 2020 2019 2019 2019
MIDDLE MARKET US MIDDLE MARKET INVESTMENT BANKING FIRM INVESTMENT BANKING FIRM INVESTMENT BANKING FIRM INVESTMENT BANK INVESTMENT BANK OF THE YEAR OF THE YEAR OF THE YEAR OF THE YEAR OF THE YEAR
INTERNATIONAL AWARDS TURNAROUND AWARDS
13 Warehousing & Fulfillment | February 2021
CITATIONS
1. Statista, “Retail E-Commerce Sales Worldwide From 2014 to 2023,” https://www.statista.com/statistics/379046/worldwide-retail-e-commerce-sales/ 2. Seeking Alpha, “Shopify Inc. (SHOP) CEO Tobi Lutke on Q2 2020 Results –Earnings Call Transcript,” https://www.seekingalpha.com/article/4361920-shopify-inc-shop-ceo-tobi-lutke-on-q2-2020-results-earnings-call- transcript 3. Business Wire, “Walmart U.S. Q1 comp sales1 grew 10.0% and Walmart U.S. eCommerce sales grew 74%, Q1 FY21 GAAP EPS of $1.40; Adjusted EPS2 of $1.18, Company incurs incremental costs related to COVID-19 of nearly $900 million, Provides update on the business amid global health pandemic,” https://www.businesswire.com/news/home/20200519005526/en 4. XPO Logistics, “XPO Logistics Announces Plan to Spin Off Logistics Segment to Its Shareholders,” https://www.investors.xpo.com/static-files/e04f3e02-1e83-4a98-b0f8-4c85c7fe1679
Disclosure: This report is a periodic compilation of certain economic and corporate information, as well as completed and announced merger and acquisi- tion activity. Information contained in this report should not be construed as a recommendation to sell or buy any security. Any reference to or omission of any reference to any company in this report should not be construed as a recommendation to buy, sell or take any other action with respect to any security of any such company. We are not soliciting any action with respect to any security or company based on this report. The report is published solely for the general information of clients and friends of Capstone Headwaters. It does not take into account the particular investment objectives, financial situation or needs of individual recipients. Certain transactions, including those involving early-stage companies, give rise to substantial risk and are not suitable for all investors. This report is based upon information that we consider reliable, but we do not represent that it is accurate or complete, and it should not be relied upon as such. Prediction of future events is inherently subject to both known and unknown risks and other factors that may cause actual results to vary materially. We are under no obligation to update the information contained in this report. Opinions expressed are our present opinions only and are subject to change without notice. Additional information is available upon request. The companies mentioned in this report may be clients of Capstone Headwaters. The decisions to include any company in this report is unrelated in all respects to any service that Capstone Headwaters may provide to such company. This report may not be copied or reproduced in any form, or redistributed without the prior written consent of Capstone Headwaters. The information contained herein should not be construed as legal advice.
14 BUILT FOR THE MIDDLE MARKET
Capstone Headwaters is one of the largest and most active independent investment banking firms in the United States. The firm has a rich, 20-year history of achieving extraordinary results for middle market entrepreneurs, business owners, investors, and creditors. Capstone offers a fully integrated suite of corporate finance services, including M&A, debt and equity placement, corporate restructuring, valuation and fairness opinions, financial advisory, and ESOP advisory services.
Headquartered in Boston, the firm has 175+ professionals across 16 offices in the U.S., and an international presence including over 450 professionals in 40 countries. With 16 dedicated industry groups, the firm delivers sector-specific expertise through large, cross-functional teams on a global basis.
UNITED STATES
170+ professionals 17 offices INTERNATIONAL Boston Burlington Chicago Dallas Denver Detroit Houston Los Angeles 450+ professionals New York Orange County Philadelphia 60+ offices in 40 countries Richmond San Diego San Francisco St Louis Tampa Washington DC Asia: China India Japan Latin America: Argentina Brazil Chile Colombia Mexico Peru Africa: Congo Egypt Ghana Ivory Coast Mauritius Morocco Senegal South Africa Europe: Belgium Bosnia Croatia Czech Republic Finland France Germany Herzegovina Hungary Ireland Italy London Netherlands Norway Poland Russia Serbia Slovenia Spain Sweden Switzerland Turkey United Kingdom
www.capstoneheadwaters.com
12