Author: Glenn Taylor

TFI International is going back on its decision to re-domicile into the U.S., instead opting to remain in Canada based on shareholder feedback.

While the trucking company did not go further beyond acknowledging the feedback in its statement, one minority shareholder had openly expressed dissatisfaction with the U.S. relocation.

Pension fund Caisse de Depot et Placement du Quebec (CDPQ), which owned a 4 percent stake in TFI as of Dec. 31, was frustrated that the company did not inform its brass before making the decision.

That fund has a mandate to try to boost the economic development of Quebec, and as such has fought to stop efforts from businesses to leave the province.

Ironically, one of the initial reasons CEO Alain Bedard cited for the move was to “better align with our shareholder base.” The plurality of TFI’s shareholders is U.S.-based, the company said in a statement. According to Bedard in Wednesday’s earnings call, 49.9 percent of shareholders were based in the U.S. as of last summer, outpacing the 45 percent that were Canadian.

Currently, TFI International Inc. is publicly traded in both the U.S. and Canada, on the New York Stock Exchange and the Toronto Stock Exchange. Bedard said the company can stay on both exchanges as long as U.S. shareholders don’t surpass 50 percent.

Shareholders aside, a move to the U.S. would have put the trucker more in line with its client base. Roughly 70 percent of the Montreal-based company’s business is domestic trucking in the U.S., while 25 percent remains in Canada.

Additionally, re-domiciling would have been beneficial for TFI’s flatbed trucking segment, Daseke. Daseke partners with the U.S. Department of Defense, which “creates a little bit of issues” for TFI as a foreign parent owner.

But in the end, the decision was always going to come down to shareholder approval, which would have been required for the relocation to occur.

The initial decision, and its quick reversal, come amid the highest tensions between Canada and the U.S. in recent memory, along with a freight recession has suppressed trucking demand since mid-2022.

On Monday, President Donald Trump said his tariffs on both Canada and Mexico are “on time” and “on schedule.” The Trump administration is slapping 25-percent duties on most Canadian imports, with energy products such as oil and electricity being tariffed at 10 percent.

The tariffs are set to go into effect March 4, after a month-long deferral, as the countries negotiate on other issues including border security.

Although only roughly 4 percent business encompasses cross-border trade at TFI, the trucking company couldn’t issue guidance due to the potential tariff impacts.

TFI’s fourth quarter was a “disaster,” Bedard said in the earnings call. While revenue increased 5.5 percent to $2.08 billion, it came in well below estimates and was buoyed by the Daseke acquisition early in 2024. Less-than-truckload (LTL), TFI’s largest segment, saw revenue decline 9.8 percent to $737.3 million when not accounting for fuel surcharges.

Net income came in at $88.1 million, down from $131.4 million in the prior year period.

Yellow offloads more two terminals to ArcBest

As TFI’s flip-flop on location unfolds, more trucking companies are participating in the fire sale of another former LTL provider’s real estate.

The estate of Yellow, the former century-old trucking business that ceased operations in summer 2023, sold off two more leased terminals to ArcBest for $11.5 million.

ArcBest, which owns LTL carrier ABF Freight, acquired a 32.5-acre, 108-door terminal in Aurora, Colo. for $7 million and a 60-door terminal on 12.6 acres in Kent. Wash for $4.5 million.

The trucking firm already had acquired four terminals from Yellow totaling $38 million across two rounds of auctions held at the end of 2023. Those auctions raised the estate $1.9 billion and $82.9 million.

ArcBest’s deal comes a week after a handful of trucking companies entered their own agreements to scoop up Yellow’s service centers.

Knight-Swift Transportation, in its pursuit to expand further into LTL, forked over $9.9 million for three California-based terminals in San Diego, Downey and Santa Maria, and another facility in Roanoke, Va.

A. Duie Pyle paid $4.5 million for terminals in Bowling Green, Ohio, and Charleston, W. Va., while TFI International bought a $700,000 terminal in Fayetteville, N.C.

Yellow’s estate has sold more than 175 terminals for more than $2.2 billion since its liquidation first began in late 2023. The insolvent trucking firm is currently selling off its real estate through both private sale transactions, with a three-day auction also scheduled for March 11.

Trucking company TFI International is planning on re-domiciling its business from Canada to the U.S.

Alain Bedard, chairman, president and CEO of TFI International, said in an earnings call that the decision was made to “better align with our shareholder base and commercial presence.”

Approximately 70 percent of the Montreal-based company’s business is domestic trucking in the U.S., while 25 percent remains in Canada. The remaining roughly 4 percent encompasses cross-border trade.

As of last summer, 49.9 percent of shareholders were based in the U.S., Bedard said, above the 45 percent that were Canadian.

TFI’s subsidiaries include less than truckload (LTL) carrier TForce Freight and flatbed trucking provider Daseke, which the company acquired for $1.1 billion in April 2024.

Bedard cited that the move is easier for Daseke since the company has a contract with the U.S. Department of Defense.

Operationally, TFI does not have current plans to move employees from Canada to the U.S. The trucking company has offices in Montreal, Toronto, Calgary, Chicago and Miami.

The whole process, from application through shareholder approval, is expected to take between nine and 12 months.

Currently trading on both the New York Stock Exchange and the Toronto Stock Exchange, TFI will not be delisting from the Canadian market as part of the move.

The expected move comes amid a tense backdrop in U.S.-Canada relations.

President Donald Trump’s threat to slap 25 percent duties on all imports from Canada still hangs in the balance even after the tariffs were deferred to March 4. Canada is also expected to start paying 25 percent tariffs on any steel and aluminum products entering the U.S. starting March 12.

If the countries don’t cut a border security deal before March 4 and Trump moves ahead with imposing the duties, Canada would place retaliatory tariffs on imports from the U.S.

According to Bedard, the tariffs and their potential impacts on cross-border trade—as well as inflation concerns—have prevented the trucking firm from issuing guidance.

TFI may not be alone in its Canadian exodus plans. In the current geopolitical climate, more Canadian businesses are looking to invest in U.S. assets. Forty-eight percent of 250 Canadian companies surveyed by KPMG plan to shift investments to the U.S. and set up operations or production south of the border to serve the U.S. market and reduce costs.

“The new U.S. administration’s economic and trade policies are having huge ripple effects in Canada and around the world,” says Lucy Iacovelli, managing partner, tax and legal, KPMG in Canada, in a statement. “There are important steps that Canadian businesses can take to prepare for trade disruption and higher costs and build resiliency. No matter when or if U.S. tariffs or tax cuts take effect, now is the time to be proactive and understand your exposure and develop mitigation strategies.”

One of TFI’s Canadian shareholders, pension fund Caisse de Depot et Placement du Quebec (CDPQ), shared its dismay with the decision. CDPQ owned a more than 4 percent stake in TFI as of Dec. 31, according to data compiled by Bloomberg.

“The company has not informed us of its intentions, and we will express our dissatisfaction,” a CDPQ spokesperson said in a statement. “Quebec’s interests are always at the heart of our priorities as a shareholder.”

‘The volumes are not there,” CEO says amid ‘disaster’ quarter

TFI International’s fourth quarter reflected trucking industry fears that the freight recession still pervades, with Bedard not holding back on his assessment of the period in the earnings call

“Q4 was a disaster for us,” he said, citing the trucking company’s poor management of labor costs and accident claims that reached 0.9 percent of total revenue.

Stock feel for more than 20 percent on the report Thursday.

Revenue rose 5.5 percent to $2.08 billion from $1.97 billion. Analysts were looking for $2.19 billion, according to FactSet.

“We’re like our peers. It’s really a very difficult start of the year. It’s very foggy,” said Bedard. “The volumes are not there. So it’s going to be a difficult 2025. When we made our plan in October for 2025, we never anticipated this kind of situation, which is still difficult in terms of volumes, both truckload and LTL.”

TFI posted a profit of $88.1 million, or $1.03 a share, in the fourth quarter, compared with $131.4 million, or $1.53 a share, a year earlier. Adjusted per-share earnings came in at $1.19 a share, missing the $1.58 analysts surveyed by FactSet expected.