EXHIBIT 99
MENLO ACQUIRES SHANGHAI-BASED CHIC HOLDINGS
Press Contacts:
Con-way/Menlo Worldwide Grayling Communications for Menlo Worldwide
Gary Frantz Belinda Tan
+1 650 378 5335 + 65 6325 4606
frantz.gary@con-way.com Belinda.tan@grayling.com.sg
KempGoldberg for Menlo Worldwide Investor Contact
Belinda Donovan/Amber Caouette Patrick Fossenier
+1 207 773 0700 Con-way/Menlo Worldwide
bdonovan@kempgoldberg.com +1 650 378 5353
acaouette@kempgoldberg.com fossenier.patrick@con-way.com
MENLO WORLDWIDE ANNOUNCES MAJOR EXPANSION IN CHINA WITH ACQUISITION OF SHANGHAI-
BASED 3PL CHIC HOLDINGS LTD.
US$60 Million Deal Makes Menlo a Leading Provider of Intra-China Logistics
SAN MATEO, Calif., and SHANGHAI, China - Sept. 9, 2007 - Menlo Worldwide,
LLC, the global logistics subsidiary of Con-way Inc. (NYSE: CNW) announced
today the signing of a definitive agreement to purchase Chic Holdings Ltd.
and its wholly owned subsidiaries Shanghai Chic Logistics Co. Ltd. and
Shanghai Chic Supply Chain Management Co. Ltd. Menlo is acquiring privately
held Chic Holdings Ltd., a corporation registered in the Cayman Islands, and
all of its assets and subsidiaries for a cash payment of US$60 million plus
an undisclosed future earn-out incentive based on its performance.
Headquartered in Shanghai, Chic Logistics is a profitable, well-established
provider of domestic third-party logistics and transportation management
services in The People's Republic of China. The company has a full-service
portfolio and network with 130 operating sites in 78 cities, providing
superior coverage of China's highly industrialized eastern sectors as well as
the mainland's interior provinces. One of China's fastest-growing third-party
logistics firms, Chic Logistics produced revenues of US$55.2 million in 2006,
a 40 percent increase over 2005.
"Chic Logistics is highly respected within China as a superior operator with
an excellent service reputation among customers," said Robert L. Bianco Jr.,
president, Menlo Worldwide. "This is the most strategic acquisition in
Menlo's history. With Chic Logistics' domestic capabilities and network, we
immediately become a major player in the intra-China market - the next great
growth engine for transportation and logistics."
"Distribution and logistics management is an exceptionally dynamic market in
China," said Johnson Shen, CEO, Chic Logistics. "Joining with Menlo will help
us to accelerate growth, introduce more services for customers, and quickly
build into new markets with international capabilities. Our clients see this
as a logical and welcome step for Chic Logistics and our employees. It is a
good match of two successful businesses with complementary individual
strengths. Together we will offer a new, stronger business value to the
market."
Combined, the two companies will comprise more than 1,500 employees in China
operating from 139 sites in 79 cities, with nearly 180,000 square meters of
warehouse space under management. Menlo's China operations will be based at
Chic Logistics' headquarters in Shanghai.
Bianco noted that the acquisition fills in a key strategic component of
Menlo's service platform not only for mainland China, but also for the
broader Asia-Pacific region. The Chic Logistics acquisition, combined with
existing Menlo operations in China and other parts of Asia and the earlier
acquisition of Singapore-based Cougar Express Logistics with operations in
Southeast Asia, positions Menlo with one of the industry's strongest and most
extensive networks for managing Asia-Pacific freight and logistics. The
expanded Asia-Pacific network will also benefit the larger Menlo and Con-way
enterprise operations in North America and Europe to provide more
comprehensive global solutions to customers.
The acquisition fulfills several strategic objectives for Menlo, which
include:
* Establishes a material presence in China. Chic Logistics is a leading
provider of domestic warehousing, distribution and transportation
management services with an impressive roster of major national and
multinational business customers. Chic Logistics gives Menlo a solid
foothold in the market with an established network of offices and
service locations; professional, experienced local management; quality
customers; market knowledge and operating expertise; and a track record
of sustained growth.
* Improves market position, service portfolio. The acquisition enables Menlo
to offer its current and prospective customers in China new options
including proven service capability for in-country China logistics.
* Creates domestic China growth platform. As manufacturing and production
continue to migrate and expand into China's interior provinces, Chic
Logistics positions Menlo to capitalize on growth in China's domestic
economy, where accelerating consumer demand for increasingly diverse
varieties of goods is expanding the market for logistics and
transportation services.
* Expands customer base and share of customers' business. The companies
share a limited number of customers. Menlo has more than 600 accounts
worldwide while Chic Logistics has two dozen primary clients in China,
presenting significant opportunity for cross-selling and introducing
expanded service solutions.
* Enhances vertical industry presence. Both companies have a complementary
vertical industry presence, each bringing respective strengths in
automotive, consumer and industrial goods, high-tech, chemical and retail.
* Leverages "non-asset" business model. Both Menlo Worldwide and Chic
Logistics subscribe to "non-asset based" or "asset-light" business models
which enable flexibility, customer responsiveness, effective cost control
and the provision of high-value services.
* Builds a clearly differentiated global network offering. The possibility
of linking Chic Logistics' domestic network with the U.S.-based
infrastructure of Menlo Worldwide and its sister companies, less-than-
truckload (LTL) carrier Con-way Freight and truckload carrier Con-way
Truckload, introduces a compelling future solution for "first-mile"
logistics in China through "last-mile" delivery in North America.
Additionally, as China's demand for imports grows, the Menlo
Worldwide/Chic Logistics combination offers a possible "first-mile,
last-mile" network for managing the flow of inbound goods into China and
delivering them to end-users.
Bianco cited several additional potential opportunities to leverage the
acquisition as a foundation for exciting new solutions to traditional
challenges that face China-based global supply chain operations. Among the
opportunities: creating more effective import distribution programs, where
inbound goods arriving from North America, Europe or other Asia-Pacific sites
would be completely managed through the supply chain by Menlo Worldwide/Chic
Logistics, from origin consolidation to delivery at the end-user on the
mainland. He also foresees similar opportunities for supplier management
programs, where Menlo Worldwide and Chic Logistics would design more
effective export consolidation and delivery programs for goods manufactured
in China for export, providing shippers with improved supply-cycle
consistency while reducing global transportation costs.
"We believe there are many untapped or underserved areas where our combined
resources can truly bring new, high-value logistics, trucking and supply
chain solutions to China's importers, exporters and domestic shippers," said
Bianco. "This acquisition will enable us to build on the foundation of an
excellent company to profitably grow and realize the potential of this
exciting and vibrant market."
The acquisition is subject to fulfillment of customary closing conditions.
The boards of both companies have approved the agreement. Settlement of the
transaction is expected to occur during the fourth quarter. Menlo intends to
finance the transaction with existing cash resources. The acquisition is
expected to be accretive to the earnings of Con-way Inc., Menlo Worldwide's
parent company, beginning in 2008.
About Menlo Worldwide
Menlo Worldwide, LLC, is a global provider of logistics, transportation
management and supply chain services with operations in North America and on
five continents. As a third-party logistics provider, San Mateo, Calif.-based
Menlo Worldwide's services range from dedicated contract logistics to
warehouse and distribution management, transportation management, supply
chain re-engineering and other value-added services including packaging,
kitting, order fulfillment and light assembly through a strategic network of
multi-client and dedicated facilities. With more than 13 million square feet
of dedicated warehouse space in North America, the Asia Pacific, Europe and
Latin America, and industry-leading technologies, Menlo creates effective,
integrated solutions for the transportation and distribution needs of leading
businesses around the world.
Menlo Worldwide, LLC, is a subsidiary of Con-way Inc. (NYSE: CNW), a $4.7
billion freight transportation and logistics company and FORTUNE magazine's
"Most Admired Company" in transportation and logistics for 2007. For more
information please visit us on the web at www.menloworldwide.com.
About Chic Holdings Ltd.
Chic Logistics and Chic Supply Chain Management are the principal owned
subsidiaries of Chic Holdings Ltd., a corporation registered in the Cayman
Islands. Based in Shanghai with offices and operations throughout China's
provinces, Chic specializes in one-stop logistics services, from local
distribution services, regional distribution services and home delivery
services through a complete and modern nationwide supply chain service.
Fortune 500 companies around the world look to Chic for innovative solutions
that help plan business strategies in China, improve customer service,
accelerate order cycle times, and tighten control of the supply chain-all
while reducing costs in transportation, inventory, and order fulfillment.
For more information, please visit us on the Web at http://www.logistics-
chic.com/en/index.htm.
FORWARD-LOOKING STATEMENTS
Certain statements in this press release constitute "forward-looking
statements" and are subject to a number of risks and uncertainties and should
not be relied upon as predictions of future events. All statements other than
statements of historical fact are forward-looking statements, including any
projections and objectives of management for future operations, any
statements concerning proposed new products or services, any statements
regarding Con-way's estimated future contributions to pension plans, any
statements as to the adequacy of reserves, any statements regarding the
outcome of any claims that may be brought against Con-way, any statements
regarding future economic conditions or performance, any statements of
estimates or belief, any statements regarding the acquisition of
Transportation Resources, Inc. and its subsidiaries, including Contract
Freighters, Inc. (collectively, "CFI"), and related financing, and any
statements or assumptions underlying the foregoing. Specific factors that
could cause actual results and other matters to differ materially from those
discussed in such forward-looking statements include: changes in general
business and economic conditions, the creditworthiness of Con-way's customers
and their ability to pay for services rendered, increasing competition and
pricing pressure, changes in fuel prices or fuel surcharges and the effect of
recently-filed litigation alleging that Con-way engaged in price fixing of
fuel surcharges in violation of Federal antitrust laws, the effects of the
cessation of the air carrier operations of Emery Worldwide Airlines, the
possibility that Con-way may, from time to time, be required to record
impairment charges for long-lived assets, the acquisition of CFI and related
financing (including without limitation risks relating to the financing,
integration risks and risks that acquisition synergies are not realized), the
possibility of defaults under Con-way's $400 million credit agreement, $500
million bridge credit agreement, and other debt instruments (including
without limitation defaults resulting from unusual charges), and the
possibility that Con-way may be required to repay certain indebtedness in the
event that the ratings assigned to its long-term senior debt by credit rating
agencies are reduced, labor matters, enforcement of and changes in
governmental regulations, environmental and tax matters, matters relating to
the 1996 spin-off of Consolidated Freightways Corporation ("CFC"), including
the possibility that CFC's multi-employer pension plans may assert claims
against Con-way, matters relating to the sale of Menlo Worldwide Forwarding,
Inc., including Con-way's obligation to indemnify the buyer for certain
losses in connection with the sale, and matters relating to Con-way's defined
benefit pension plans. The factors included herein and in Item 7 of Con-way's
2006 Annual Report on Form 10-K as well as other filings with the Securities
and Exchange Commission could cause actual results and other matters to
differ materially from those in such forward-looking statements. As a result,
no assurance can be given as to future financial condition, cash flows, or
results of operations.