Target Company Overview

Select Express & Logistics (SEL), headquartered in New York, NY, is a prominent third-party logistics (3PL) provider specializing in last mile delivery and assembly services for large consumer and commercial goods, such as furniture and fitness equipment. Since its establishment in 2001, SEL has built a strong reputation in the industry, recognized for its exceptional customer service and a technologically advanced national network of delivery and assembly technicians.

Under the leadership of its management team, SEL has experienced remarkable growth, tripling its revenues and doubling its workforce since LongueVue Capital's acquisition in 2018. The company has notably diversified its customer base and strategically expanded its capabilities through the acquisition of Go Configure, further solidifying its position in the last mile logistics market.

Industry Overview in the U.S.

The last mile delivery sector in the United States has gained significant momentum, delving into a time when consumer demand for quick and reliable delivery services has escalated. The rise of e-commerce and changes in consumer behavior, particularly due to the COVID-19 pandemic, have increased the need for efficient last mile solutions, especially for bulky items.

Amidst growing competition, companies that excel in operational agility and customer satisfaction are positioned to thrive. The introduction of technology into logistics has streamlined processes, allowing firms to enhance their service offerings, optimize delivery routes, and improve the customer experience. Additionally, seamless integration of assembly services further enriches the last mile delivery proposition.

Given these dynamics, the market is expected to experience substantial growth over the coming years, as consumer demands continue to evolve and expand. Companies that focus on providing quality service, leveraging technology, and maintaining strong partnerships will likely dominate the landscape.

Rationale Behind the Deal

The acquisition of SEL by AIT Worldwide Logistics was driven by the desire to enhance AIT's service portfolio, particularly within the growing last mile delivery segment. Bringing SEL into AIT’s operations allows for expanded capabilities in servicing large and bulky shipments, which is increasingly in demand in today’s market.

Furthermore, the successful transformation of SEL during LongueVue Capital's tenure demonstrates the company’s operational strength and readiness for integration into a larger supply chain network, providing a strong strategic fit for AIT.

Investor Information

LongueVue Capital (LVC), a private equity firm based in New Orleans, is known for its commitment to investing in middle-market companies across various sectors, including transportation and logistics. Founded in 2001, LVC employs a partnership-centric approach, providing not only capital but also operational expertise to drive value creation.

Over its investment lifecycle, LVC has developed a track record of impactful partnerships with entrepreneurs, assisting in growth and operational enhancement. In particular, LVC has invested around $500 million across its funds, focusing on identifying and fostering high-growth businesses such as SEL.

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From an analytical perspective, LongueVue Capital's exit from Select Express & Logistics represents a strategically sound decision. The firm effectively capitalized on SEL's growth trajectory and the favorable market conditions in the last mile logistics industry. Given SEL's strong performance and successful operational enhancements during LVC's ownership, the exit appears to be a profitable outcome for the investors.

Moreover, AIT’s acquisition of SEL signifies a strategic move to integrate a proven player into their operations, implying a potential for robust value creation moving forward. The alignment of SEL’s capabilities with AIT’s broader logistics network can enhance operational efficiencies and broaden service offerings.

However, the future success of this investment for AIT will heavily depend on their ability to effectively combine SEL’s unique delivery methodologies into their existing framework, ensuring that they maintain SEL's strong customer service standards while scaling operations effectively.

Overall, it is viewed that this acquisition could lead to significant growth opportunities for AIT, given the increasing demand for last mile delivery services in the U.S. With the right execution strategy, this deal positions both SEL and AIT for long-term success and consolidation within the expanding logistics market.

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