Bankruptcy court approves Simon Transportation asset sale
Apr 11, 2002 12:00 PM, Gary MacklinFederal bankruptcy court in Salt Lake City has approved the sale of assets of Simon Transportation Services to Central Freight Lines of Waco TX. Central is controlled by Jerry Moyes, chairman of Simon and Swift Transportation. As part of the deal, Central has formed a division known as Central Refrigerated Service to operate Simon. The reorganized company will be roughly 40% smaller with about 1,500 tractors and 2,100 trailers. Management and headquarters will be retained. The purchase price, which includes assets and assuming equipment leases, is said to be $152 million or more. This substantially raises Moyes investment in Simon, which he took over for $20 million in mid-2000 and has since spent almost $9 million more in loans. Published reports say that Central will take over operations on April 22, 2002.
Moyes has been quoted as saying that the new operation will be profitable from the moment it opens its doors. Profitability is anticipated as the new Central division sheds almost $100 million in undesirable business and terminates 800 low-performing drivers.