Name: Yellow Roadway Corporation 

Address: 1077 Gorge Blvd.  

City: Akron  State: Ohio

Phone Number: 330-384-1717   

CEO:  Bill Zollars

Products: Transportation  

Employees: 50,000  Year Founded: 2003 

            Yellow Corporation and Roadway Corporation have entered into a definitive agreement under which Yellow Corporation will acquire Roadway Corporation for approximately $966 million, or $48 per share (based on a fixed exchange ratio and a 60-day average price per share of $24.95 for Yellow common stock in a half cash, half stock transaction). This represents a 49 percent premium for Roadway shares based on the 60-day average closing price of Roadway stock. Yellow Corporation will also assume an expected $140 million in net Roadway indebtedness, bringing the enterprise value of the acquisition to approximately $1.1 billion.

            The combined enterprise, which will be known as Yellow-Roadway Corporation, will be one of the largest transportation service providers in the world, with the ability to move shipments domestically and internationally. Yellow-Roadway will be the largest U.S.-based transportation service provider with a focus on big shipments for business-to-business customers. The combined revenue of both companies for the 12 months ending the first quarter of 2003 was nearly $6 billion.

            Bill Zollars, currently chairman, president, and chief executive officer of Yellow, will be chairman, president, and chief executive officer of the combined company. James D. Staley, currently president and chief executive officer of Roadway, will continue to lead Roadway, which will be an operating entity under the Yellow-Roadway holding company. Three members of the Roadway board of directors will join the board of Yellow-Roadway – Frank P. Doyle, John F. Fiedler, and Phillip J. Meek.

            The complementary operations and capabilities of Yellow and Roadway provide the combined company with the increased scale, strong financial base, and market reach necessary to increase shareholder value and enhance customer service. Specifically, this transaction will allow Yellow-Roadway to:

            •Strengthen its position in the competitive domestic and global transportation marketplace.

            •Continue to invest in and grow the brands of both businesses.

            •Implement best practices over a broader customer base.

            •Leverage service capabilities and technologies for the benefit of customers.

            •Introduce non-asset-based transportation management services to Roadway customers.

            Yellow Corporation expects the transaction to be accretive within 12 months after closing and provide a return in excess of the weighted average cost of capital in the second year. Annual synergies of $45 million should be achieved by the end of the second year. By year five annual synergies could be in excess of $125 million.

            “This strategic combination brings the strengths of Yellow and Roadway together to capture significant synergies and growth opportunities,” says Zollars. “It accelerates our ongoing strategy, implemented over the past six years, to transform Yellow into a global transportation services and solutions leader. While there will be no change in the customer interface, customers can benefit from new and expanded service capabilities and greater technological advances.

            “Roadway’s management team has done an outstanding job developing their company into a leading transportation service provider. The new organization can enhance shareholder value and employee opportunities at both companies.”

            Staley said, “Our decision to combine with Yellow Corporation is an excellent step forward for our company. Given the similarities in transportation operations, capabilities, and union relations that our companies share, partnering with Yellow is a logical move that clearly positions our combined organization for long-term growth and success.

            “Our Akron headquarters will continue to be a major center of operations, and we will continue to invest in and build the brands of both companies. Moreover, Roadway employees will become part of a larger and stronger enterprise well positioned for profitable growth.”

            Says Zollars: “Our synergy teams are focused on reducing administrative costs, creating efficiencies, and identifying duplicative areas within our two organizations. We expect minimal employee displacement among field sales and operations at either company. Among other employee groups, all decisions are expected to be made based on best practices and expertise, irrespective of company affiliation.

            “We are creating an enterprise with a stable work environment and avenues for job growth. Our management teams are looking forward to working closely together for a smooth and expeditious transition. From increased scale and greater efficiencies, to long-term growth and financial strength, this is the right transaction at the right time with the right partner.”

About Yellow

            Yellow Corporation, a Fortune 500 company, is a holding company that through wholly owned operating subsidiaries offers its customers a wide range of asset and non-asset based transportation services integrated by technology. Its largest subsidiary, Yellow Transportation, offers a full range of regional, national and international services for the movement of industrial, commercial and retail goods. Meridian IQ is a non-asset global transportation management company that plans and coordinates the movement of goods worldwide. Yellow Technologies provides innovative technology solutions and services exclusively for Yellow Corporation companies. Headquartered in Overland Park , Kansas , Yellow Corporation employs approximately 23,000 people.

About Roadway

            Included in the Dow Jones Transportation Average, Roadway Corporation, is a holding company dedicated to leveraging opportunities to expand the transportation-related service offerings available to customers through the Roadway portfolio of strategically linked transportation companies. Roadway Corporation’s principal subsidiaries include Roadway Express and Roadway Next Day Corporation.

            Roadway Express is a leading ISO 9001 and C-TPAT/PIP and FAST certified transporter of industrial, commercial and retail goods in the two- to five-day regional and long-haul markets. Roadway Express provides seamless service throughout all 50 states, Canada , Mexico and Puerto Rico including export/import services for more than 100 countries worldwide. Roadway Express owns Reimer Express Lines in Canada and Mexican-based Roadway Express, S.A. de C.V. Roadway Next Day Corporation is a holding company focused on business opportunities in the shorter-haul regional and next-day markets.

            Roadway Next Day Corporation owns New Penn Motor Express, a next-day, ground less-than-truckload carrier of general commodities serving twelve states in the Northeastern United States , Quebec , Canada and Puerto Rico , with links to the Midwest and Southeast United States and Ontario , Canada .