HG Vora Capital Management, an activist investor, is eyeing the buy of fleet management and supply chain operator Ryder System, The Wall Street Journal reported Friday (May 13).
HG Vora already owns a 9.9% stake in the company, and the $4.4 billion deal on offer would take Ryder private. In a regulatory filing last week, HG Vora said it wanted to buy the rest of the company’s outstanding shares at $86 per share.
Ryder’s shares fell as much as 25% from late March to mid-April, due to inflation and various weaknesses in the U.S. economy. However, as of the acquisition proposal, the company’s shares were up 18%, after a trading pause for volatility.
Ryder said in a statement it was planning to review the interest from HG Vora, and would decide on its next steps based on the best solution for shareholders. HG Vora said it would fund the acquisition with its own funds along with lender commitments.
Ryder has been going through an “ambitious” expansion of its supply chain services business, the report noted.
PYMNTS wrote that Ryder recently began working with InsurTech REIN to roll out an embedded insurance program for its commercial vehicle sales customers, letting the buyers consider REIN insurance as they buy trucks.
This goes along with other services already offered, including financing, warranty and prepaid preventative maintenance. The report noted that it has historically been difficult for users to get insurance for their used commercial vehicles.
Eugene Tangney, vice president of used vehicle sales at Ryder, told PYMNTS that the insurance options were important because of the volume of new buyers entering the trucking market. Additionally, pandemic-driven supply chain challenges have led people to form new companies which now need some help acclimating to the business.