Atlanta (April 23, 2014) – Affiliates of Eagle Merchant Partners (EMP), an Atlanta, Ga.-based private equity firm focused on middle-market buyouts in the Southeastern United States, have acquired LSO (formerly known as Lone Star Overnight), an Austin, Texas-based regional small parcel and same-day delivery solution provider.
This is the second deal for EMP following the acquisition of Vasari, the second largest Dairy Queen franchise in the United States in late 2013. EMP is well versed in logistics, as its partners were involved in the acquisition, development and successful sale of 3PD, a last-mile heavy goods delivery company, and remain involved in the ongoing management of PODS, the category creator and leader of portable storage and moving. The firm invested approximately $20 million in equity for the LSO acquisition with support from well-known institutional partners and family offices. NXT and New Canaan provided debt financing for the deal.
With a service area covering every address in Texas, Oklahoma, western Louisiana, southern New Mexico and, through partnerships, California, the western U.S. and Mexico, LSO is a fast-growing regional small parcel delivery company operating an integrated ground and air, point-to-point mini-hub model. Serving thousands of customers daily, it also has many ecommerce customers and is actively forging strategic partnerships with several large ecommerce companies to provide delivery services in the region.
“LSO is a rapidly growing company with a strong management team. The company has distinct advantages in better service, lower damage rates and, usually better pricing,” said Ransom James, Partner, EMP. “We are excited to invest in the people, the fleet and new delivery channels.”
LSO offers a full range of next-day and day-definite guaranteed deliveries and has one of the highest reliability records and lowest damage rates in the industry. Extended pick-up times, early morning delivery options and competitive rates make LSO a high-service, high-value shipping provider.
“LSO is excited to partner with EMP to grow the business in our current markets and to expand both our channels and coverage areas,” said Rick Jones, CEO of LSO. “EMP brings logistics expertise and capital to the table, and we are already planning new growth avenues.”
The company has developed a solid client base while focusing on niche markets including industrial products, distributors, energy, specialty pharmaceuticals, wine, e-commerce and many others. There is opportunity for additional growth by expanding LSO’s existing market and putting more resources into sales and marketing efforts as well as through EMP’s interest in acquiring similar businesses in adjacent markets.