Yellow Corporation · OTC:YELLQ
Yellow — Yellow Roadway — Merger or Acquisition (February 2005)
15 slides from Yellow's merger presentation, Feb 28, 2005
Slide 1: Opportunity Knocks Twice
Opportunity Knocks Twice February 28, 2005
Slide 2: Strategic Rationale
Strategic Rationale A mutually beneficial combination that delivers value to shareholders of both companies Scale Services Synergies Strong balance sheet Shareholder value opportunity
Slide 3: Scale
Scale 2005 pro forma revenue of $9.7 billion $6 billion in combined assets Over 70,000 employees 25,000 trucks and 90,000 trailers Over 1,000 locations worldwide 2005 Estimated Revenue (in billions) $9.7 $7.2 $2.5 USFC Yellow Roadway Pro Forma Making global commerce work by connecting people, places
Slide 4: Services
Services Comprehensive next day services nationwide Holland, Reddaway, Dugan, Bestway, and New Penn Extensive national networks Roadway Express and Yellow Transportation Efficient, variable-speed line haul networks Premium services Expedited, time definite, trade show, cross border, etc. 4+ Days 20%
Slide 5: Services (continued)
Services (continued) Truckload Glen Moore and the truckload brokerage services of Yellow Roadway Non-asset-based capabilities Meridian IQ and USF Logistics offer complementary services Meridian IQ USF Logistics International freight forwarding X Customs brokerage X Dedicated fleet X Contract warehou
Slide 6: Synergy Areas
Synergy Areas Combination leverages the core strengths of both companies Sharing of best practices Labor – opportunity for cohesive labor strategy Technology Develop it once, use it multiple times Share industry leading technology Purchasing leverage Support functions
Slide 7: Synergy Targets
Synergy Targets Approximately $20 million of cost synergies required to be accretive in the first twelve months We expect around $40 million of cost synergies in the first twelve months and an additional $80 million by the end of year two Longer term synergy potential in excess of $150 million We ex
Slide 8: Strong Balance Sheet
Strong Balance Sheet Pro Forma Debt to EBITDA (net of cash) 1.8x <1.5x <1.0x 12/31/04 12/31/05 12/31/06 Strength of current balance sheets support transaction financing Free cash flow generation allows for rapid debt reduction Financial results above combine Yellow Roadway and USFC for all periods p
Slide 9: Track Record of Success
Track Record of Success Our track record of strategic success 2002 – Secondary stock offering 2002 – Spin-off of SCST 2003 – Roadway transaction We have created significant shareholder value over the last three years by focusing on our core business
Slide 10: Leveraging Our Successful Strategy
Leveraging Our Successful Strategy Roadway Transaction USF Transaction Maintain separate brands X X No change to customer interface X X Significant synergies available X X Service overlap X Limited customer overlap X X Geographic overlap X X Experienced and committed operating management X X
Slide 11: An Expanded Portfolio of Brands
An Expanded Portfolio of Brands
Slide 12: Management Team
Management Team Bill Zollars Chairman, President and CEO Yellow Roadway Corporation Jim Staley President Yellow Roadway Regional Companies Glen Moore James Welch President Yellow Transportation Bob Stull President Roadway Express Jim Ritchie President Meridian IQ / USF Logistics Mike Smid President
Slide 13: Transaction Highlights
Transaction Highlights Transaction value of $1.37 billion*; enterprise value of $1.47 billion* USF shareholders can elect from the following, subject to proration, for each share of USF stock they hold: Cash of $45 per share, or 0.9024 shares (fixed exchange ratio) of Yellow Roadway stock Total gros
Slide 14: Next Steps
Next Steps Timeline (estimated) File proxy statement/prospectus with the SEC by April 1 Obtain shareholder approval Obtain regulatory approval Transaction expected to close in the summer of 2005
Slide 15: Forward-Looking Statements
Forward-Looking Statements This presentation (and oral statements made regarding the subjects of this presentation contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Words
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