THE MORGAN GROUP, INC. ANNOUNCES
AGREEMENT TO ACQUIRE TRANSIT HOMES OF AMERICA
Baltimore, Maryland -- November 19, 1996 -- The Morgan Group, Inc.
(AMEX:MG) today announced that it had executed a definitive agreement in
principle to purchase the assets of Transit Homes of America ("Transit"), a
privately held company based in Boise, Idaho.
Transit, with annual sales in excess of $28 million, serves, as does
Morgan, a number of the leading producers in the manufactured housing industry,
including Fleetwood Enterprises, Champion Enterprises, Redman Homes, Palm
Harbor, Schult Homes, and Cavalier Homes. Morgan, the nation's leading service
provider to the manufactured housing industry, will finance the purchase of
Transit by a combination of cash on hand, notes to the seller and available bank
lines of credit. The purchase price combines guaranteed and earnings-based
incentive payments to the seller, and management believes the acquisition will
have a favorable impact both on Morgan's customer service capabilities and its
per share and overall profitability. The purchase, subject to receipt of final
audited statements and other due diligence requirements, is expected to be
finalized prior to year-end.
Larry Kling, the President, CEO and primary shareholder of Transit who
built the company over the years, stated that he was "very happy to be joining
forces with Morgan. Together, we should be able to serve our customers better,
offer greater opportunity for our combined force of independent owner-operator
drivers, and operate more efficiently and profitably for shareholders. I am
pleased that the Transit Home Division of Morgan Drive Away will continue to
provide services to its customer group."
Charles C. Baum, Chairman and CEO of Morgan, stated that "this is a
significant move for Morgan in following our strategy of consolidating our
position of market leader within our industry niche. We are fortunate in being
able to bring such a major player into our fold and are especially happy that
Larry Kling, CEO of Transit, will join Morgan to insure a smooth transition with
major customers, employees and drivers for Transit."
"We expect the acquisition of Transit to add importantly to our ability
to serve major customers nationwide," added Terry Russell, President and Chief
Executive Officer of Morgan's principal operating subsidiary, Morgan Drive Away,
Inc. "This should bring our organization to new levels in terms of size,
efficiency, training, and safety. The terms of the deal, and our plans for
consolidating these operations, bode well for the future earnings power of
Morgan."
The Morgan Group is the nation's leader in providing outsourcing
transportation services to the manufactured housing and recreational vehicle
industries, and also arranges for the movement of commercial vehicles, office
trailers, automobiles, buses, and a variety of other vehicles and freight. The
company has a national network of approximately 1,525 full-time independent
owner operators and 1,555 other drivers assigned to its driver outsourcing
division, dispatched from 103 offices in 36 states. Transit will add
approximately 400 drivers which are currently managed out of about 40 offices.
Morgan also provides insurance and financial services to owner-operators through
its Interstate Indemnity and Morgan Finance subsidiaries.
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Contact:
Charles C. Baum OR Terence L. Russell
Chairman and President and
Chief Executive Officer Chief Executive Officer
The Morgan Group, Inc. Morgan Drive Away, Inc.
Telephone: 410-566-9200 Telephone: 219-295-2200
Fax: 410-947-0612 Fax: 800-295-0828
Release: 96.11