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Press release from CNW Group

TransForce Enters into Arrangement Agreement to Acquire Vitran

Monday, December 30, 2013

TransForce Enters into Arrangement Agreement to Acquire Vitran

07:00 EST Monday, December 30, 2013

MONTREAL, Dec. 30, 2013 /CNW Telbec/ - TransForce Inc. (TSX: TFI) (OTCQX: TFIFF), a North American leader in the transportation and logistics industry, today announced that it has entered into an Arrangement Agreement with Vitran Corporation Inc. (Nasdaq:VTNC) (TSX:VTN) pursuant to which an affiliate of TransForce would acquire all of the issued and outstanding shares of Vitran not already owned by TransForce at a price of USD$6.50 per share in cash.  The total transaction, including the assumption of Vitran's outstanding net debt of approximately US$29 million at October 31, 2013, is valued at approximately US$136 million. The US$6.50 share price represents an 11.16% premium to Vitran's closing price on NASDAQ on December 9, 2013, the day that Vitran's proposed transaction with Manitoulin Transport Inc. was announced, and a 41.38% premium to the closing price on NASDAQ on September 20, 2013, the day before the announcement of the sale of Vitran's US Less-Than-Truckload (LTL) business.

Vitran has terminated the agreement that it had entered into with an affiliate of Manitoulin Transport on December 9, 2013, which contemplated the sale of Vitran at a price of USD$6.00 per share, following the decision by Manitoulin Transport to not exercise its right to match TransForce's offer of USD$6.50 per share announced on December 20, 2013.

Mr. Alain Bédard, Chairman, President and CEO of TransForce noted: "We are delighted to have reached agreement with Vitran for what represents the acquisition of an important strategic asset for TransForce with considerable synergistic benefits in the near term and into the future.  We are looking forward to leveraging the strengths of both companies to enhance our service offering for our customers and welcoming the Vitran employees to the TransForce team."

The transaction is structured as a Plan of Arrangement under the Business Corporations Act (Ontario) (the "Arrangement"). The Arrangement has been unanimously approved by the board of directors of Vitran and is subject to approval by the shareholders of Vitran at a special meeting expected to be held in February 2014 (the "Special Meeting") and final approval of the Ontario Superior Court of Justice following the Special Meeting. The Arrangement is also subject to the receipt of applicable regulatory approvals, including approval under the Competition Act, and satisfaction of other customary closing conditions. The Arrangement is not conditional on TransForce obtaining financing. The Arrangement Agreement contains customary non-solicitation provisions and provides that the board of directors of Vitran may, under certain circumstances, terminate the Arrangement Agreement in order to accept an unsolicited superior proposal, subject to a matching right in favour of TransForce. If the Arrangement Agreement is terminated in certain circumstances, including if Vitran accepts a superior proposal, TransForce is entitled to a termination payment of US$4.0 million. The Arrangement is expected to close in late February or early March 2014. An information circular (the "Information Circular") outlining details of the Arrangement and Special Meeting is expected to be prepared by Vitran and mailed to shareholders of Vitran in January 2014. Copies of the Information Circular will be available under Vitran's profile on SEDAR at www.sedar.com and on EDGAR at www.sec.gov.

TransForce currently owns 19.95% of Vitran's outstanding shares.  In addition, and as previously-announced on November 1, 2013, TransForce signed a lock-up agreement with Quinpool Holdings Partnership, a subsidiary of Clarke Inc. (TSX: CKI), whereby Quinpool Holdings has, among other things, agreed to support a transaction like the Arrangement, including voting its 418,837 shares of Vitran in favour thereof. The 418,837 shares held by Quinpool Holdings represent approximately 2.55% of Vitran's outstanding shares.

TransForce has retained National Bank Financial Markets as its financial adviser and Heenan Blaikie LLP as legal adviser.

ABOUT TRANSFORCE
TransForce Inc. is a North American leader in the transportation and logistics industry operating across Canada and the United States through its subsidiaries. TransForce creates value for shareholders by identifying strategic acquisitions and managing a growing network of wholly-owned, operating subsidiaries. Under the TransForce umbrella, companies benefit from corporate financial and operational resources to build their businesses and increase their efficiency. TransForce companies service the following segments:

  • Package and Courier; 
  • Less-Than-Truckload; 
  • Truckload, which includes specialized truckload and dedicated services;
  • Specialized Services, which includes services to the energy sector, waste management, logistics and ancillary transportation services.

TransForce Inc. is publicly traded on the Toronto Stock Exchange (TSX: TFI) and the OTCQX marketplace in the U.S. (OTCQX: TFIFF). For more information, visit http://www.transforcecompany.com.

FORWARD-LOOKING STATEMENTS
Except for historical information provided herein, this press release may contain information and statements of a forward-looking nature concerning the future performance of TransForce. These statements are based on suppositions and uncertainties as well as on management's best possible evaluation of future events. Such factors may include, without excluding other considerations, fluctuations in quarterly results, evolution in customer demand for TransForce's products and services, the impact of price pressures exerted by competitors, and general market trends or economic changes. As a result, readers are advised that actual results may differ from expected results. No assurance can be given that any events anticipated by the forward-looking information or statements will transpire or occur, or if any of them do so, what benefits that TransForce will derive therefrom. In particular, no assurance can be given as to whether the proposed acquisition of Vitran Corporation Inc. will be completed.

SOURCE TransForce Inc.

For further information:

Investors:      
Alain Bédard
Chairman, President and CEO
TransForce Inc.
(514) 331-4200
abedard@transforcecompany.com

Media:
Rick Leckner
MaisonBrison Communications
 (514) 731-0000
rickl@maisonbrison.com

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