Bradley S. Jacobs

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Bradley Jacobs
Born (1956-08-03) August 3, 1956 (age 60)
Providence, Rhode Island, U.S.
Residence Greenwich, Connecticut, U.S.
Alma mater
Occupation CEO
Known for
  • Chairman and CEO of XPO Logistics
  • Co-founder of United Rentals
  • Founder of United Waste Systems
  • Founder of Hamilton Resources (UK)
  • Co-founder of Amerex Oil Associates

Bradley “Brad” Jacobs (born August 3, 1956) is an American businessman. He is the chairman and chief executive officer of XPO Logistics, Inc. and managing director of Jacobs Private Equity, LLC.[1] Jacobs is best known for having led rapid industry consolidations in waste management and equipment rental in North America, and in global transportation and logistics. He's spearheaded approximately 500 acquisitions and another 250 cold-starts over the course of his career,[1] raising over $20 billion in capital, including more than $14 billion for XPO. In April 2017, the Bloomberg Billionaires Index estimated Jacobs' net worth at over $1.4 billion.[2]

Early life and education[edit]

Jacobs was born in Providence, Rhode Island. His father was a jewelry importer. He attended Northfield Mount Hermon School, Bennington College and Brown University in the 1970s, but dropped out to broker oil contracts.[3]

Career[edit]

Amerex Oil Associates, Inc.[edit]

In 1979, at the age of 23, Jacobs co-founded Amerex Oil Associates Inc., an oil brokerage firm with offices in New Jersey, Houston, London, and Tokyo,[1][4][5] and served as its CEO until the firm was sold in 1983. In that time, the company's annual gross contract volume grew to approximately $4.7 billion.[1]

Hamilton Resources (UK) Ltd.[edit]

In 1984, Jacobs went to England and founded Hamilton Resources (UK) Ltd., an oil trading company,[3] using the bulk of his savings and a $1 billion line of credit from Banque Paribas.[5] As chairman and chief operating officer, he grew the company to approximately $1 billion in annual revenue, before quitting the business in 1988 and moving back to the United States.[3]

United Waste Systems, Inc.[edit]

In July 1989, Jacobs founded United Waste Systems in Greenwich, Connecticut, planning to consolidate small garbage collectors that had overlapping routes in rural areas.[4] Jacobs served as chairman and CEO,[6] and in 1992 he took the company public on the NASDAQ Stock Market. In August 1997, after the company had made 200 acquisitions,[3] Jacobs sold United Waste Systems to USA Waste Services Inc. (now known as Waste Management, Inc.) for $2.5 billion.[5][7][8] At the time of sale, United Waste Systems was the fifth-largest solid waste management company in North America, outperforming the S&P 500 Index 5.6 times over and delivering a 55% compound annual rate of return from its initial public offering to its sale to USA Waste Services.[1][7]

United Rentals, Inc.[edit]

In September 1997, Jacobs formed United Rentals,[4][7] serving as the new company's chairman and CEO. As with United Waste, Jacobs planned to grow United Rentals through a rollup strategy, consolidating small equipment rental dealers across North America.[6][9] The company began acquiring companies in October 1997 with the purchase of six small leasing outfits.[4][10]

United Rentals went public in December 1997,[10][11][12] and began trading on the New York Stock Exchange.[4]

In June 1998, United Rentals acquired U.S. Rentals Inc. for a sum variously reported at $1.2 billion[13] and $1.31 billion, creating the largest equipment rental company in North America. By October 1999, Jacobs’ personal wealth had reportedly increased to $590 million, putting him just short of making the Forbes 400 list that year.[3]

Jacobs utilized information technology to integrate the company’s geographically disparate rental outlets[14] and reduce the unnecessary discounting of rental rates.[9][15] Jacobs also introduced a business-to-business website where companies could research, rent and buy equipment.[4]

In September 2003, Jacobs announced that he planned to step down as CEO of United Rentals at the end of the year, that he would continue on as executive chairman, and that he would remain the company’s largest non-institutional private shareholder.[6][9][15][16]

In July 2007, Jacobs signed a definitive merger agreement for United Rentals to be acquired by affiliates of Cerberus Capital Management LP for $6.6 billion, including the assumption of $2.6 billion in debt obligations.[17] The merger fell through four months later, in November 2007, when Cerberus backed out of the deal due to the weakened U.S. credit market.[18] United Rentals sued in an attempt to force Cerberus to complete the transaction, but in December the Delaware Court of Chancery ruled that the merger agreement allowed Cerberus to walk away as long as it paid a $100 million breakup fee, which it did.[18]

By August 2007, United Rentals had become the 536th largest public corporation in America, as ranked by Fortune magazine.[19] Jacobs announced that month that he was stepping down as the company's chairman and director.[20] During its 10 years under Jacobs' direction, United Rentals' stock outperformed the S&P 500 Index 2.2 times over.[1]

At this point in his career, Jacobs had engineered approximately 500 acquisitions,[16] including more than 250 rental companies for United Rentals.[11][21]

XPO Logistics, Inc.[edit]

On June 14, 2011, Jacobs announced his intention to lead an investment of up to $150 million in Express-1 Expedited Solutions (trading at the time as AMEX: XPO), a third-party logistics and transportation service provider.[5]

The investment was completed on September 2, 2011, with Jacobs assuming the roles of chairman of the board and chief executive officer,[22][23] and gaining ownership of approximately 71 percent of the company. He announced plans to move the headquarters from Michigan to Greenwich, Connecticut and to change the company's name to XPO Logistics, retaining the symbol XPO on the New York Stock Exchange.[24] On October 12, 2011, Jacobs rang the bell to open the Exchange.[25]

Acquisitions and investments[edit]

Further information: XPO Logistics

During his tenure as CEO, Jacobs has overseen a number of acquisitions and investments by and for XPO, turning it into a company with more than 50,000 customers, served by over 88,000 employees and 1,440 locations in 34 countries.[26]

  • On July 15, 2013, the company announced its agreement to buy 3PD, Inc., the largest provider of last-mile logistics for heavy goods in North America, for about $365 million in cash and stock. XPO completed the purchase on August 16, 2013.
  • On March 31, 2014, XPO acquired Pacer International, making it the third-largest provider of intermodal services in North America;[27] a facilitator for about 10 percent of all domestic intermodal freight movements; and the largest provider of intermodal services between the U.S. and Mexico.[28]
  • On September 2, 2014, XPO acquired New Breed Logistics, which provided supply chain technology to large companies.[29][30]
  • On September 11, 2014, XPO announced a definitive agreement with several investment organizations to channel $700 million into the company for the purposes of making further acquisitions.[31][32][33]
  • On April 28, 2015, XPO announced a $3.56 billion (€3.24 billion) deal to acquire Norbert Dentressangle, one of Europe's largest third-party logistics companies.[34][35] It completed the acquisition on June 8, 2015.
  • On June 1, 2015, XPO announced definitive agreements with a group of global institutional investors to raise a total of $1.26 billion of equity. The group included the original September 2014 investors, each of which increased its holdings in XPO and were joined by 12 institutional investors, including sovereign and university endowment funds.[36][37]
  • On September 9, 2015, XPO announced a $3 billion deal to acquire Con-way, the second-largest LTL operator in North America.[38] It completed the acquisition on October 30, 2015, reaching $15 billion of revenue and $1.1 billion of EBITDA.[39]

By this point in his career, Jacobs had spearheaded over $20 billion in fundraising for various corporations, including more than $14 billion for XPO.[40][41][42][43][44][45][46][47][48]

Consolidation[edit]

After its 2015 purchase of Con-way, XPO's share prices dropped 33%, as Con-way was considered a poor performer in the industry despite its size.[2] Jacobs called a halt to XPO's growth-by-acquisition strategy and turned the company's focus to consolidation: rebranding purchased trucks,[49] prioritizing customer service and e-commerce,[50] and strengthening XPO's internal culture.[51]

In the wake of Jacobs' decision, XPO posted a full year of profits for the first time since 2011,[52] and saw its stock increase by 61% in 12 months.[2] In 2017, it was listed by Transport Topics as the #1 third-party logistics provider in North America.[53]

Personal life[edit]

Jacobs is married with four children.[3]

Awards and recognition[edit]

In March 2009, Jacobs was inducted into the American Rental Association’s Hall of Fame.[11][21]

On November 25, 2015, Jacobs was named American Shipper’s Person of the Year.[54]

On December 2, 2015, Jacobs was listed among the Best CEOs of the 2016 All-America Executive Team.[55]

References[edit]

  1. ^ a b c d e f "Jacobs Private Equity, LLC". Jacobs Private Equity. Retrieved August 20, 2016. 
  2. ^ a b c Tom Metcalf (April 4, 2017). "Why Billionaire Brad Jacobs Is Putting Dealmaking on Hold". Bloomberg. Retrieved April 16, 2017. 
  3. ^ a b c d e f "Near Misses". Forbes. October 11, 1999. Retrieved November 11, 2011. 
  4. ^ a b c d e f "United Rentals, Inc. – Company History". Fundinguniverse.com. Retrieved November 11, 2011. 
  5. ^ a b c d "June 4, 2005 Entrepreneur tells of unknown future". StamfordAdvocate. May 10, 2011. Retrieved November 11, 2011. 
  6. ^ a b c "October 1, 2003 United Rentals CEO Steps Down". StamfordAdvocate. May 10, 2011. Retrieved November 11, 2011. 
  7. ^ a b c Silvia Sansoni (April 8, 1996). "The earth mover". Forbes. Retrieved November 11, 2011. 
  8. ^ "The big bet of Brad Jacobs". DCVelocity. January 9, 2012. Retrieved May 12, 2016. 
  9. ^ a b c Brandey Chewning Smith, RER (November 1, 2003). "United Rental CEO". Rermag.com. Retrieved November 11, 2011. 
  10. ^ a b Wall Street Journal, June 17, 1998, “United Rentals Business Bores All but Holders”
  11. ^ a b c Christine Coleman. "Hoxie, Jacobs and Plugge join the Rental Hall of Fame". Rentalmanagementmag.com. Retrieved November 11, 2011. 
  12. ^ "United Rentals Makes Offer For Acquisition-Minded Rival – New York Times". The New York Times. April 6, 1999. Retrieved November 11, 2011. 
  13. ^ "Rental Firms to Merge in $1.2-Billion Deal – Los Angeles Times". Articles.latimes.com. July 24, 2007. Retrieved November 11, 2011. 
  14. ^ Michael Roth, RER (September 1, 2001). "Built to LAST". Rermag.com. Retrieved November 11, 2011. 
  15. ^ a b ""United Rentals' best days are still ahead" Brad Jacobs". Rentalmanagementmag.com. Retrieved November 11, 2011. 
  16. ^ a b "Chief Executive Plans to Leave United Rentals – New York Times". The New York Times. September 30, 2003. Retrieved November 11, 2011. 
  17. ^ "UNITED RENTALS, INC. | United Rentals Announces Agreement To Be Acquired By Cerberus Capital Management". Newswire.ca. Retrieved November 11, 2011. 
  18. ^ a b Dealbook (December 24, 2007). "United Rentals Concedes Defeat in Cerberus Battle". Dealbook.nytimes.com. Retrieved November 11, 2011. 
  19. ^ "FORTUNE 500 2007: United Rentals". CNN. Retrieved November 11, 2011. 
  20. ^ "Brad Jacobs Steps Down as United CEO". Rermag.com. October 1, 2007. Retrieved November 11, 2011. 
  21. ^ a b "Jacobs, Hoxie and Plugge to be Inducted in Rental Hall of Fame". Rermag.com. October 31, 2008. Retrieved November 11, 2011. 
  22. ^ "The big bet of Brad Jacobs". dcvelocity.com. January 9, 2012. Retrieved June 6, 2012. 
  23. ^ A. Ananthalakshmi (October 6, 2011). "DealTalk: Brad Jacobs: a U.S. transport serial acquirer". Reuters. Retrieved November 11, 2011. 
  24. ^ "Jacobs has big plans for Express-1 expediter". greenwichtime.com. February 7, 2012. 
  25. ^ "12 October 2011 XPO Logistics rings the NYSE Opening Bell". Youtube.com. 12 Oct 2011. 
  26. ^ "XPO Logistics Announces Pricing of Private Offering of $535 Million 6.125% Senior Notes". twst.com. August 12, 2016. Retrieved August 23, 2016. 
  27. ^ "XPO Logistics Inc : to Acquire Pacer International". 4-traders.com. 6 January 2014. 
  28. ^ "XPO Logistics Agrees to buy Pacer". Wall Street Journal. 6 January 2014. 
  29. ^ McCracken, Jeffrey (July 30, 2014). "XPO Pulls Off 500 Purchases While Bypassing Wall Street". bloomberg.com. Retrieved September 2, 2014. 
  30. ^ "VIDEO: The M&A King Wheeling and Dealing Without Bankers". BloombergTV. September 8, 2008. Retrieved September 2, 2014. 
  31. ^ "XPO Logistics Gets $700 Million Investment to Fund Acquisitions". Wall Street Journal. September 11, 2014. Retrieved October 23, 2014. 
  32. ^ "Singapore's GIC, others invest $700 mln in XPO Logistics". reuters.com. September 11, 2014. Retrieved October 23, 2014. 
  33. ^ "XPO looks to beef up contract logistics business". reuters.com. September 12, 2014. Retrieved October 23, 2014. 
  34. ^ "XPO Logistics Buying Norbert in $3.53 Billion European Deal". bloomberg.com. Retrieved June 1, 2015. 
  35. ^ "XPO Logistics to buy France's Norbert Dentressangle". reuters.com. Retrieved June 1, 2015. 
  36. ^ "PSP Investments, GIC and Ontario Teachers' Pension Plan to invest $700 Million in XPO Logistics". canadianshipper.com. Retrieved February 17, 2016. 
  37. ^ "XPO LOGISTICS RAISES $1.26 BILLION OF EQUITY". investors.xpologistics.com. Retrieved February 17, 2016. 
  38. ^ "Buying Con-way, XPO shifts from 'asset light' to 'asset right'". joc.com. Retrieved February 17, 2016. 
  39. ^ "XPO Logistics Chairman and CEO Jacobs talks about next steps for Con-way acquisition and integration". logisticsmgmt.com. November 5, 2015. Retrieved February 16, 2016. 
  40. ^ "Bradley S. Jacobs to Lead Equity Investment of up to $150 Million in Express-1 Expedited Solutions". BusinessWire. June 14, 2011. Retrieved April 16, 2017. 
  41. ^ "XPO Logistics Announces Closing of $137 Million Common Stock Offering". SEC.gov. March 20, 2012. Retrieved April 16, 2017. 
  42. ^ "XPO Logistics Announces Closing of $125 Million Convertible Senior Notes Due 2017". SEC.gov. September 26, 2012. Retrieved April 16, 2017. 
  43. ^ "XPO Logistics Announces Full Exercise of Underwriters' Option for 1,454,104 Shares of Common Stock". XPO Logistics. August 19, 2013. Retrieved April 16, 2017. 
  44. ^ "XPO Logistics Announces Exercise of Underwriters' Option for 2,250,104 Shares of Common Stock". XPO Logistics. February 11, 2014. Retrieved April 16, 2017. 
  45. ^ "XPO Logistics Announces Pricing of its Private Placement Notes Offering". XPO Logistics. August 14, 2014. Retrieved April 16, 2017. 
  46. ^ "XPO Logistics Completes Previously Announced Private Offering of Senior Notes". XPO Logistics. February 13, 2015. Retrieved April 16, 2017. 
  47. ^ "XPO Logistics Announces Pricing of Private Placement Notes Offering". XPO Logistics. June 4, 2015. Retrieved April 16, 2017. 
  48. ^ "XPO Logistics Announces Pricing of Private Offering of $535 Million 6.125% Senior Notes". XPO Logistics. August 12, 2016. Retrieved April 16, 2017. 
  49. ^ Kicinski, Gary (April 6, 2017). "Stifel's John Larkin on XPO's Success, Logistics Trends". Transport Topics. 
  50. ^ "XPO's Jacobs Sees E-Commerce as Key to Robust Growth in 2017". Transport Topics Online. Retrieved 2017-04-19. 
  51. ^ "Video: XPO's Jacobs defends globalization". www.joc.com. Retrieved 2017-04-19. 
  52. ^ "XPO Logistics Notches First Full-Year Profit Since 2011". Transport Topics Online. Retrieved 2017-04-19. 
  53. ^ "Logistics Market Continues to Evolve; XPO Jumps to No. 1 on Top 50 List". Transport Topics Online. Retrieved 2017-04-19. 
  54. ^ "Person of the Year". American Shipper. November 25, 2015. Retrieved May 12, 2016. 
  55. ^ "The All-America Executive Team" (PDF). Institutional Investor. December 2, 2015. Retrieved May 12, 2016.