INDIANAPOLIS, IN January 18, 2005 Celadon Group, Inc. (Nasdaq: CLDN) announced today that one of it's wholly-owned subsidiaries purchased the truckload van business and approximately 370 tractors and 670 van trailers of CX Roberson, Inc. for approximately $22.7 million. In addition, Celadon offered employment to approximately 320 qualified drivers. According to the sellers unaudited financial statements, the Champaign, Illinois-based van division of CX Roberson generated approximately $45 million in gross revenue in 2004. The transaction did not include Robersons flatbed business and related assets.
Steve Russell, Chairman and Chief Executive Officer, stated, We are delighted with the Roberson acquisition and expect it to follow the pattern established in our Burlington and Highway Express acquisitions during the past few years. In those acquisitions, as in this one, our goals are to continue to diversify our customer base with quality customers, add density in our primary traffic lanes, and gain a significant number of experienced drivers.
Based on our evaluation of the business, we believe Roberson had a core group of high-quality customers and drivers, but suffered from the excessive cost structure that plagues many mid-sized carriers. We expect to integrate the acquired operations promptly. As part of the integration process, we expect to optimize the combined customer, driver, and equipment base to improve asset productivity. We believe we can enhance the service to Robersons former customers through an upgraded equipment fleet, excellent technology, more available assets for dispatch, and an outstanding safety record.
At Celadon, our driver turnover has been significantly better than the industry average over the past few years, and we plan to work hard to retain the Roberson drivers. To assist in this goal, as well as to adhere to our existing equipment strategy, we plan to retain approximately 200 of the newest tractors and approximately 200 of the newest trailers from the acquisition and dispose of the balance. In the short-term, the additional Roberson drivers will retain their units until seated with newer equipment. We believe this strategy will allow us to focus on the most favorable freight and discontinue hauling freight that does not fit our operations, assist with driver retention and minimize the risk of unseated tractors following the acquisition, and operate a newer fleet with lower maintenance costs. We expect the acquired operations to be accretive beginning in the June 2005 quarter."