XPO Explores Sale of European Transportation Business

XPO Inc. is in the process of potentially selling its European transportation division after previously halting a similar attempt nearly two years ago. The company has been exploring options and negotiating with prospective buyers for its truckload and freight forwarding operations, with an estimated sale value of up to $2 billion. Despite these efforts, discussions remain ongoing, and there's a possibility that XPO may opt to retain the European assets for a longer period. In 2022, XPO announced plans to split its freight brokerage and North American trucking operations into two separate publicly traded entities to concentrate on its less-than-truckload business, but later decided against selling the European unit due to unfavorable capital market conditions. XPO's shares have surged 59% over the past year, reflecting a market capitalization of approximately $13.6 billion, with about 60% of its revenue derived from the U.S. and the remainder from Europe. From a transportation industry perspective, the timing and execution of this potential sale could indicate the company's strategic focus towards streamlining its operations and maximizing profitability. Given the current economic climate and fluctuating capital markets, the decision to divest or hold on to European assets may hinge on broader market stability and XPO's long-term business objectives. The logistics space is highly competitive, and having a strong foothold in both North America and Europe could be beneficial for XPO in navigating global supply chain challenges.