FedEx Corp has announced that its Board of Directors has decided to fully separate FedEx Freight into a new, publicly traded company.
The separation is expected to be achieved in a tax-efficient manner for FedEx stockholders and executed within the next 18 months.
FedEx and FedEx Freight will continue to pursue their growth strategies. The separation will allow for more customised operational execution along with more tailored investment and capital allocation strategies to serve the unique and evolving needs of both the global parcel and LTL markets.
The companies will also maintain the strategic advantages of cooperation on key commercial, operational, and technology initiatives. Customers of both businesses will continue to enjoy the same superior service, speed, and coverage they have come to expect from FedEx.
“This is the right time to pursue a separation as we respond to the unique dynamics of the LTL market,” says Raj Subramaniam, FedEx Corp. President and Chief Executive officer.
“This announcement is a testament to the strength of the business our team has built, and to our dedication to doing what’s best for our customers, our team members, and our stockholders. Through this process, we will unlock value for our Freight business and position FedEx to create even greater value for stockholders.”
“Over the last 50 years, FedEx has built an unmatched global platform that has produced significant value for our stockholders and opportunities for our team members,” says R. Brad Martin, vice chairman of the Board and chairman of the Audit and Finance Committee who led the Board’s oversight of the strategic analysis.
“Building upon that powerful foundation, and following a careful assessment of our portfolio, the FedEx Corporation Board is confident that a separation of FedEx Freight will drive continued growth and value creation.”
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