When Did UPS Buy Coyote? Acquisition Details & History

In 2015, UPS acquired Coyote Logistics, a major third-party logistics provider. This move significantly expanded UPS's brokerage and freight capabilities. Let's explore the details of this acquisition and its impact on the logistics industry.

Key Takeaways

• UPS acquired Coyote Logistics on July 31, 2015.
• The acquisition price was $1.8 billion.
• Coyote Logistics operates as an independent unit within UPS.
• The acquisition strengthened UPS's position in the freight brokerage market.
• Coyote's technology platform enhances UPS's logistics solutions.

Introduction

The acquisition of Coyote Logistics by UPS was a strategic move to enhance UPS's presence in the rapidly growing freight brokerage sector. Coyote, known for its technology-driven approach and vast network of carriers, provided UPS with a significant boost in its ability to handle less-than-truckload (LTL) and truckload freight. This article delves into the specifics of the acquisition, the reasons behind it, and its effects on both companies and the broader logistics landscape.

What & Why: The UPS and Coyote Deal

What is Coyote Logistics?

Coyote Logistics is a leading third-party logistics (3PL) provider that specializes in truckload brokerage and transportation management services. Founded in 2006, Coyote quickly established itself as a major player by connecting shippers with available carriers through its advanced technology platform. Their services include freight brokerage, transportation management, and supply chain solutions.

Why Did UPS Acquire Coyote Logistics?

UPS's acquisition of Coyote Logistics was driven by several strategic objectives:

• Expanding Freight Brokerage Capabilities: The primary reason was to strengthen UPS's position in the truckload freight brokerage market. Coyote’s expertise and technology platform allowed UPS to offer a broader range of services to its customers.
• Technology and Innovation: Coyote's technology platform, which efficiently matches shippers with carriers, was a key asset. This technology helped UPS optimize its operations and improve service delivery.
• Customer Demand: The demand for freight brokerage services was growing, and UPS needed to expand its offerings to meet customer needs. Coyote provided the necessary infrastructure and expertise to capitalize on this trend.
• Market Growth: The freight brokerage market was, and continues to be, a high-growth area within the logistics industry. Acquiring Coyote allowed UPS to tap into this growth and diversify its revenue streams.

The Acquisition Details

The deal was finalized on July 31, 2015, with UPS paying $1.8 billion in cash for Coyote Logistics. At the time, Coyote had a network of over 35,000 carriers and annual revenues exceeding $2 billion. The acquisition was seen as a significant investment by UPS in its future growth and capabilities.

How the Acquisition Happened

The acquisition process involved several key steps:

1. Initial Negotiations: UPS and Coyote Logistics engaged in initial discussions and negotiations to determine the terms of the acquisition.
2. Due Diligence: UPS conducted a thorough review of Coyote's financials, operations, and technology to assess its value and potential synergies.
3. Agreement and Announcement: Once both parties agreed on the terms, the acquisition was formally announced.
4. Regulatory Approvals: The acquisition was subject to regulatory approvals, which were obtained without significant issues.
5. Finalization: The deal was finalized on July 31, 2015, and Coyote Logistics became a wholly-owned subsidiary of UPS.

Examples & Use Cases

Real-World Impact

• Enhanced Service Offerings: UPS has been able to offer its customers a more comprehensive suite of logistics services, including truckload brokerage, transportation management, and specialized freight solutions.
• Improved Efficiency: Coyote's technology platform has helped UPS optimize its freight operations, leading to improved efficiency and reduced costs.
• Expanded Market Reach: The acquisition has allowed UPS to expand its reach in the freight brokerage market, serving a broader range of customers and industries.

Case Studies

While specific case studies directly linking the acquisition to quantifiable improvements are proprietary, the general benefits are clear:

• A large retailer needing to manage seasonal demand surges can leverage Coyote’s carrier network through UPS to secure capacity.
• A manufacturer seeking to optimize its transportation costs can use Coyote’s technology platform, integrated with UPS’s solutions, to find the most cost-effective shipping options.

Best Practices & Common Mistakes

Best Practices for Logistics Acquisitions

• Clear Strategic Alignment: Ensure the acquisition aligns with the company's overall strategic goals.
• Cultural Integration: Focus on integrating the cultures of the two organizations to ensure a smooth transition.
• Technology Synergies: Leverage the technological capabilities of both companies to create a competitive advantage.
• Customer Focus: Maintain a strong focus on customer needs and ensure the acquisition enhances service offerings.

Common Mistakes to Avoid

• Overpaying: Avoid overpaying for the acquisition, which can lead to financial strain.
• Poor Integration: Failing to integrate the two organizations effectively can lead to operational inefficiencies.
• Loss of Key Talent: Ensure key employees are retained to maintain continuity and expertise.

FAQs

1. What is freight brokerage?

Freight brokerage involves connecting shippers with carriers to transport goods. Brokers use their network and technology to find the best rates and services.

2. How does Coyote Logistics operate within UPS?

Coyote Logistics operates as an independent unit within UPS, maintaining its brand and operational autonomy while leveraging UPS's resources and network.

3. What are the benefits of using a third-party logistics provider?

3PLs offer expertise, technology, and a broad network of carriers, helping businesses optimize their supply chains and reduce costs. — Valencia CA Zip Code: Your Complete Guide

4. How has the acquisition impacted UPS's service offerings?

The acquisition has broadened UPS's service offerings to include truckload brokerage, transportation management, and specialized freight solutions.

5. What role does technology play in freight brokerage?

Technology platforms match shippers with carriers, optimize routes, track shipments, and provide real-time visibility, improving efficiency and service.

6. What was the main driver behind UPS acquiring Coyote Logistics?

The primary driver was to strengthen UPS’s presence and capabilities in the rapidly growing freight brokerage market, leveraging Coyote’s technology and network. — Los Angeles Weather In April: What To Expect

Conclusion with CTA

The acquisition of Coyote Logistics by UPS in 2015 was a significant strategic move that has enhanced UPS's capabilities in the freight brokerage market. By integrating Coyote's technology and expertise, UPS has been able to offer a broader range of logistics solutions to its customers. To learn more about UPS's freight services and how they can benefit your business, visit the UPS website or contact a UPS representative today. — NFL Overtime Rules Explained: How It Works

Last updated: June 2, 2024, 03:17 UTC