TRUCKING & LOGISTICS MERGER & ACQUISITION PERSPECTIVES 2017 & 2018 OUTLOOK bkdcorporatefinance.com

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1 TRUCKING & LOGISTICS MERGER & ACQUISITION PERSPECTIVES 2017 & 2018 OUTLOOK

2 OVERVIEW & OUTLOOK The & (T&L) market remained an active space for merger and acquisition (M&A) activity in 2017, with a 21 percent increase in deals compared to This increase was primarily driven by strategic players growing through acquisitions as a means to increase cost efficiencies, access new technologies and increase vertical and horizontal integration. One of the more notable transactions in 2017 was Knight Transportation merging with Swift Transportation to create a nearly $6 billion enterprise. The two Phoenix, Arizona-based companies will have a combined asset-based fleet of over 23,000 tractors and 77,000 trailers, making Knight-Swift the largest truckload services carrier in North America. Industry Highlights Rising demand will be a major driver for increased freight costs in Freight volumes in December hit nearly all-time highs, supported by the strong consumer confidence tailwind. Spot-market prices for dry vans are up more than 20 percent year-over-year. Analysts expect long-term negotiated shipping rates to increase between 5 to 8 percent in A nationwide truck shortage is forcing shippers to either postpone less timesensitive freight or pay a premium to expedite and review priority. While trucking companies are adding additional fleets, the lag will still impact many shippers and drive up costs. New federal regulations now require drivers to track their hours behind the wheel with electronic logging devices, which has further contributed to the truck shortage. To keep ahead of volatile consumer demand, predictive and analytics software will be implemented within the logistics segment. By 2020, over one-third of all manufacturing supply chains will be using analytics-driven cognitive capabilities, increasing cost efficiency by 10 percent and service performance by 5 percent. Deals by Segment 2016 vs CONTENTS Deal Activity Public Comparables About BKD Corporate Finance BKD Services ABOUT BKDCF Founded in 1994, BKD Corporate Finance helps companies and stockholders go beyond their numbers by creating value through investment banking solutions that include mergers, acquisitions, sales, recapitalizations, management buyouts and financings. T&L CONTACTS Gregory Lafin Managing Director Chicago, IL glafin@bkd.com 12.9% Tony Schneider Managing Director Indianapolis, IN tschneider@bkd.com 20.8% Source: S&P Capital IQ, Material Handling & 2

3 DEAL ACTIVITY Deals by Segment Deals by Buyer Type Strategic 92% Financial 8% Select Deals by Segment Date Target Buyers Transaction Value EV to Revenue EV to EBITDA 12/12/17 New Acton Mobile Industries WillScot Corporation (NasdaqCM:WSC) $ N/A N/A 12/7/17 Keen Transport, Inc. Wallenius Wilhelmsen ASA $ x 6.40x (OB:WWL) 11/1/17 Indiana Transport Patrick Industries, Inc. (NasdaqGS:PATK) $59.00 N/A N/A 9/5/17 United Road Services The Carlyle Group L.P. (NasdaqGS:CG) - N/A N/A 7/6/17 Interstate Distributor Co. Heartland Express, Inc. (NasdaqGS:HTLD) $ x N/A 6/14/17 Old Dominion Truck Leasing Penske Truck Leasing Co., L.P. - N/A N/A 4/14/17 Prairie Van & Storage, Inc. Ace Industrial Properties, Inc - N/A N/A 4/10/17 Swift Transportation Company Knight-Swift Transportation Holdings Inc. $2, x NM (NYSE:KNX) 4/3/17 Crown Moving Co., Inc. Bekins Moving & Storage Co. - N/A N/A 12/7/17 APEX Group GlobalTranz Enterprises, Inc. - N/A N/A 11/29/17 The Clark Group, Inc. LSC Communications, Inc. (NYSE:LKSD) - N/A N/A 9/5/17 Sandifer-Valley Transportation and Radiant Global, Inc. - N/A N/A 7/31/17 Fairrington Transportation Corporation LSC Communications, Inc. (NYSE:LKSD) - N/A N/A 7/18/17 Commodity Forwarders Inc. and Trillvane Kuehne + Nagel International (SWX:KNIN) - N/A N/A 7/6/17 Grand Worldwide Corporation American Fast Freight, Inc. - N/A N/A 5/16/17 Planning Services GlobalTranz Enterprises, Inc. - N/A N/A 4/24/17 Masterpiece International Limited Magnate Worldwide, LLC - N/A N/A 1/10/17 Global Freight Source GlobalTranz Enterprises, Inc. - N/A N/A Source: S&P Capital IQ 3

4 DEAL ACTIVITY Middle Market Truck Transportation & Distribution Deals EV to EBITDA Multiples 5.0x 5.7x 6.3x 5.3x 5.3x 6.7x 6.8x 7.7x $10MM - $25MM $25MM - $50MM $50MM - $100MM $100MM - $250MM Truck Transportation Distribution Top 15 Strategic Buyers by Number of Deals ( ) # of Investor Name Deals GlobalTranz Enterprises, Inc. 4 Radiant, Inc. (AMEX:RLGT) 3 Magnate Worldwide, LLC 3 CAI International, Inc. (NYSE:CAI) 3 Celadon Group, Inc. (NYSE:CGI) 3 Dicom Transportation Group, L.P. 3 Kuehne + Nagel Interntl AG (SWX:KNIN) 2 ABF II, Inc. 2 Blue-Grace LLC 2 CRST International, Inc. 2 American Fast Freight, Inc. 2 Daseke, Inc. (NasdaqCM:DSKE) 2 LSC Communications, Inc. (NYSE:LKSD) 2 USPack Corp. 2 Radiant Global, Inc. 2 Top 15 Private Equity Buyers with Active Holdings in / Segments Investor Name # of Active Holdings Segment Investment Interest KJM Capital 5 The Jordan Company 4 & Platinum Equity 4 H.I.G. Capital 4 Oak Lane Partners 3 TPG Capital 2 Ridgemont Equity Partners 2 Argosy Private Equity 2 ZS Fund 2 Hyde Park Holdings 2 American Infrastructure Funds 2 Incline Equity Partners 2 Lion Equity Partners 2 Linx Partners 2 Wind Point Partners 1 Source: S&P Capital IQ, Pitchbook and GF Data (consists of middle market private equity transactions from 2005 to 2018) 4

5 PUBLIC COMPARABLES 42.00% 32.00% T&L Segments vs. S&P 500 Price Change 22.00% 12.00% 2.00% -8.00% % S&P 500 LTM EV/EBITDA NTM EV/EBITDA 10.8x 8.6x 10.9x 9.6x S&P x 10.9x Average Revenue Growth ( ) Average EBITDA Growth ( ) 28% 21% 14% 22% 22% 9% S&P 500 S&P 500 Source: S&P Capital IQ 5

6 0.7x 0.6x 0.8x 0.8x 0.8x 1.0x 1.1x 1.0x 5.9x 7.0x 9.3x 7.4x 7.0x 7.7x 8.9x 7.8x 6.9x 8.5x TRUCKING PUBLIC COMPARABLES in millions of dollars Enterprise Values Recent Price TTM TTM Enterprise EBITDA EV to EV to Company Ticker (2/28/2018) Revenue EBITDA Value Margin Sales EBITDA J.B. Hunt Transport Services, Inc. JBHT $ $7,190 $1,010 $14, % Old Dominion Freight Line, Inc. ODFL , , % Knight-Swift Transportation Holdings KNX , , % Landstar System, Inc. LSTR , , % Ryder System, Inc. R ,330 1,732 9, % Saia, Inc. SAIA , , % Heartland Express, Inc. HTLD , % Marten Transport, Ltd. MRTN , % ArcBest Corporation ARCB , % Daseke, Inc. DSKE % Covenant Transportation Group, Inc. CVTI % YRC Worldwide Inc. YRCW , , % P.A.M. Transportation Services, Inc. PTSI % USA Truck, Inc. USAK % Roadrunner Transportation Systems RRTS , % 0.28 NM Celadon Group, Inc. CGI , % Median Average Average Large Cap (Over $10B) Average Mid Cap ($2B-$10B) Average Small Cap (Under $2B) x Ten-Year Average EV/Revenue Publics vs. S&P x 1.6x 1.5x 1.7x 1.9x 2.0x 2.1x 2.4x 9.3x Ten-Year Average EV/EBITDA Publics vs. S&P x 8.8x 8.4x 8.2x 9.1x 10.0x 10.5x11.1x 12.2x Source: S&P Capital IQ Average of Average of S&P 500 6

7 1.1x 0.9x 1.1x 1.4x 8.5x 7.9x 10.2x 9.0x 8.5x 13.0x 10.5x 10.5x 9.2x 1 LOGISTICS PUBLIC COMPARABLES in millions of dollars Enterprise Values Recent Price TTM TTM Enterprise EBITDA EV to EV to Company Ticker (2/28/2018) Revenue EBITDA Value Margin Sales EBITDA United Parcel Service, Inc. UPS $ $65,872 $9,811 $110, % FedEx Corporation FDX ,335 8,485 78, % C.H. Robinson Worldwide, Inc. CHRW , , % XPO, Inc. XPO ,381 1,282 16, % Expeditors International of Washington EXPD , , % ZTO Express ZTO , , % Forward Air Corporation FWRD , , % Air Transport Services Group, Inc. ATSG , , % Atlas Air Worldwide Holdings, Inc. AAWW , , % Hub Group, Inc. HUBG , , % Echo Global, Inc. ECHO , % Radiant, Inc. RLGT % Median Average Average Large Cap (Over $10B) Average Small Cap (Under $2B) Ten-Year Average EV/Revenue Publics vs. S&P 500 Ten-Year Average EV/EBITDA Publics vs. S&P x 1.6x 1.6x 1.6x 1.5x 1.7x 1.9x 2.0x 2.1x 9.3x 7.8x 8.8x 8.4x 8.2x 12.2x 11.1x 9.1x 10.0x10.5x Source: S&P Capital IQ Average of Average of S&P 500 7

8 CONTACT US T&L TEAM INDUSTRY FOCUS Gregory Lafin Managing Director Chicago, IL Tony Schneider Managing Director Indianapolis, IN ABOUT US The professionals of BKDCF have more than 200 years of combined experience helping company owners plan for and execute their growth and exit strategies. From managing the sale of a company to negotiating the acquisition of a competitor or raising debt and equity capital to improve financial and operational flexibility, BKDCF can help you to develop a specific course of action for achieving your desired results. Manufacturing & Distribution Business Services Financial Services Health Care Construction & Engineering Energy BKDCF, a wholly owned subsidiary of BKD, LLP, helps companies and stockholders go beyond their numbers by creating value through investment banking solutions that include mergers, acquisitions, sales, recapitalizations, management buyouts and financings. Founded in 1994, BKDCF is staffed with experienced investment bankers and financial analysts. In addition, the firm draws on the resources of BKD with its network of accountants, auditors, tax professionals, business consultants and industry-specific consultants. BKDCF is a member of the Financial Industry Regulatory Authority and the Securities Investor Protection Corporation. Consumer Services & Products 8 Technology, Media & Telecom

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