The Canadian trucking industry should expect more consolidation among carriers in the future, including the arrival of some major US players, predicted Mark Seymour, president of Kriska Holdings.
Seymour said ongoing domestic consolidation and the potential arrival of new competitors from south of the border were a couple of the reasons Kriska chose recently to enter into an investment agreement with Mullen Group, Truck News reports.
“I think the Americans are coming,” he told attendees at the Surface Transportation Summit in Toronto this morning. “They’ll buy their way into Canada or find their way in some other way. Building mass and building scale puts us in a better position to defend against what it is they are likely to do.”
Seymour said Kriska has tried growing organically for the past three to five years but has been unable to add capacity due to the shortage of drivers.
David Newman, equity research analyst with Cormark Securities, agreed with Seymour’s outlook of the M&A landscape, adds Truck News:
“Smaller carriers face a whole host of challenges and it’s going to get tougher,” Newman said, citing a tightening regulatory environment and the driver shortage. “You’ve got US carriers kicking tires.”
He cited Celadon’s purchase of Yanke and Kenan Advantage Group’s purchase of RTL Westcan’s bulk division as two recent examples.
Newman said he wouldn’t be surprised if at least one major Canadian carrier was eventually broken up into several divisions and parts sold off; and there could be more Canadian trucking companies going public as well.
Full Truck News story here.
