Triumph Bancorp, Inc. has closed the acquisition of Transport Financial Solutions (TFS)’s transportation factoring assets by Triumph Business Capital. Triumph Business Capital is an indirect wholly owned subsidiary of the Company. While TFS is a wholly owned subsidiary of Covenant Logistics Group, Inc.
The acquisition transaction was subject to the transfer of the ownership of TFS Factory assets comprising $103.3 million amount of net accounts receivable and assets related to transportation factoring. The assets will be substituted against the cash consideration of $108.4 million and common shares of the Company valued up to $13.9 million. On the acquisition TFS will also earn a contingent cash consideration totaling up to approximately $9.9 million in 12-month period ending July 31, 2021, while both companies also moved into an ongoing referral arrangement.
The acquisition of TFS is in-line with Triumph’s aim of broadening its footprint in transportation industry. While Triumph Business Capital Platform will not only achieve net of operating cost savings but it will add up approximately $0.15 per share to the annual earnings of Triumph. The conversion of the TFS clients onto the Triumph Business Capital platform will be completed by July 31, 2020, subjects to the transaction terms.
Triumph Business Capital founder and chief executive officer, Aaron P. Graft said, “The trust developed through that relationship led to discussions on how Triumph Business Capital could leverage its factoring expertise to serve the TFS customers, while allowing Covenant to focus on its core business.”
TFS senior vice president and general manager Derwin Brendle commented. “This acquisition will enable a fluid and efficient transition for the TFS factoring customers as Covenant exits the factoring businesses and focuses its efforts on its core transportation and logistics services.”
“We are excited to welcome the clients of TFS to Triumph Business Capital,” said Geoff Brenner, chief executive officer of Triumph Business Capital. “We are also excited to welcome industry veteran Derwin Brendle to the Triumph team. He will work closely with our operational teams to ensure a smooth experience as the TFS clients migrate to our proprietary platform. Going forward, Derwin will serve as the vice president of special markets, maintaining key client relationships and identifying opportunities to further grow the Triumph portfolio.”