FedEx to Spin Off FedEx Freight, Creating Two Public Companies

FedEx Corp. (NYSE: FDX) announced plans to separate FedEx Freight into a new publicly traded company, aiming to unlock significant value for stockholders. The separation is expected to be completed within 18 months in a tax-efficient manner.

“This is the right time to pursue a separation as we respond to the unique dynamics of the LTL market,” said Raj Subramaniam, FedEx Corp. president and CEO. “This announcement is a testament to the strength of the business our team has built.”

The move will allow FedEx and FedEx Freight to focus on their respective growth strategies while maintaining operational synergies. “Building upon that powerful foundation, the FedEx Corporation Board is confident that a separation of FedEx Freight will drive continued growth and value creation,” said R. Brad Martin, vice chairman of the Board.

The separation will enable each company to have enhanced operational focus, distinct investment profiles, and strong balance sheets. Both companies will continue to benefit from commercial collaboration and shared branding under the FedEx name.

FedEx Freight, with $9.4 billion in revenue in fiscal 2024, is the largest LTL carrier in the industry. The company plans to maintain its leadership position with a strong balance sheet post-separation.

Goldman Sachs & Co. LLC is serving as the financial advisor, and Skadden, Arps, Slate, Meagher & Flom LLP is serving as legal counsel for the transaction.