UPT to acquire Florida Rock for $65.9M

United Petroleum Transports leaders intend to grow the 57-year-old company into a top-five tank truck carrier by revenue.

They’re one step closer to achieving that goal this week.

The Oklahoma-based bulk hauler revealed Wednesday it agreed to acquire Florida Rock & Tank Lines through the Jacksonville, Florida-based carrier’s parent company, Patriot Transportation Holding, for approximately $65.9 million in a move that will create a combined operation with revenue in excess of $200 million, excluding fuel surcharges.

The transaction, if approved, is expected to close in early 2024, the companies reported.

“We’re really excited about what we can do with both of these great teams put together,” David Price, UPT executive vice chairman, told Bulk Transporter.

Together, the two companies will boast more than 1,000 drivers and 30 terminals across 11 states in the southern U.S., stretching from Arizona to Florida. They’ll also have roughly 500 company-owned power units and 300 independent-contractor trucks, and more than 1,000 tank trailers primarily used for hauling petroleum products.

They’ll operate independently as sister companies under a new holding company, leaders said.

“The two companies are culturally aligned,” said Rob Sandlin, Patriot president and CEO. “I’ve known [UPT executive chairman] Greg Price for over 20 years, so we know each other really well, and we have a good understanding of how each other’s business is run. There’s a lot of mutual respect there.”

Going private

Florida Rock was founded in 1962. It has traded on the Nasdaq stock exchange since 1986, when shareholders voted to take the company public. As a result of the sale to the Price family for $16.26 per share, it will go private in a move Sandlin—who’s been with the company for 39 years—calls “a real benefit.”

“It takes away the red tape of being public, and dealing with the Securities and Exchange Commission and investors,” said Sandlin, who served as 2021-22 National Tank Truck Carriers chairman. “You spend more time on those sorts of things, which you’re required to do, in a public business than in a private business.”

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Tom Baker, Patriot chairman of the board, who’s family founded Florida Rock, said he’s happy UPT appreciates the quality of the organization. “We appreciate the support of our shareholders and believe this transaction rewards them for their unwavering support,” he said in a news release.

Greg Price called the union a “perfect match,” aiding their efforts to expand in the Southeast.

“We are pleased to welcome one of the leading bulk and tank trucking providers to UPT’s family,” he said. “Together we will enhance our shared value proposition and invest in exciting growth opportunities providing transportation solutions for new and existing customers.”

Diversify and grow 

While both carriers primarily transport fuels, Florida Rock also hauls other commodities, including dry bulk, creating new opportunities for UPT.

“Our goal is to diversify,” Matt Herndon, UPT president and CEO, told Bulk Transporter. “This is a diversification play, because we pick up some water, as well as some dry bulk. But we also started doing some intermodal drayage, and other things on the dry van side. So we’ll always be a bulk tank carrier. That’s our legacy fleet. But we’re also looking at opportunities to diversify from a commodity perspective—and this is one piece of that.”

Herndon also plans to grow the two operations organically.

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“We grew 20% organically last year, and we’re on pace to do the same thing this year, for UPT, setting aside the acquisition,” he said.

“My strategy is to do the same thing at Florida Rock.”

They’ll start by “filling in the gaps” in their service areas, targeting states like Arkansas, Missouri, and Louisiana to create a network that’s “truly coast-to-coast.” “When you look at the map, and our operating entities, there’s really very little overlap,” Herndon said. “We opened up in Atlanta a year ago, and placed a few trucks in Birmingham, because we wanted to grow organically, but that’s the only overlay of the footprint.”

Talk of the town

Herndon said the announcement had everyone talking at the 2023 Society of Independent Gasoline Marketers of America (SIGMA) Annual Conference this week in Orlando, Florida, where he quickly went to work assuring customers the combination of UPT and Florida Rock will result in enhanced services for all.

“We’re just looking forward to the future,” he said. “We plan to build both brands.

“That’s what’s exciting about this. It combines two solid brands in the industry and extends the footprint of both.”

David Price was equally busy, fielding calls from customers and employees eager to learn how the transaction will impact them.

Now he’s eager to get on the road and tell them in person.

“We visited with their leadership team [Wednesday] morning, when it went public, and had virtual townhalls with both companies,” he said. “And UPT’s ownership does plan to travel around and visit as many of their terminals as humanly possible with the holidays around the corner.

“The people make this business run, so we want to get to know them. We want to learn how they do things, and what they do, and get in the action. That’s our family culture—to know the people who run our business—and that’s what we plan to do with Florida Rock as well.”