Millard Refrigerated Services acquired in multimillion-dollar deal

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Posted: Thursday, March 13, 2014 12:00 am

Millard Refrigerated Services has entered into an agreement to be acquired by Lineage Logistics, a Colton, Calif.-based refrigerated warehousing and distribution service company.

Terms of the deal were not disclosed, but a person familiar with the sale said it was “a multimillion-dollar deal.”

Omaha-based Millard Refrigerated Services celebrated its 50th anniversary last year and is the fourth-largest company of its kind in the world, according to the International Association of Refrigerated Warehouses.

Lineage Logistics, the global industry’s second-largest company, has only slightly more total cold-storage capacity but had more than twice the market share of Millard Refrigerated in 2013, according to data from IARW and market research firm IBISWorld.

The industry supports customers, including food manufacturers and retailers, by providing temperature-controlled storage and warehousing facilities and distribution.

Millard Refrigerated was born in 1963, when construction contractor Larry Larsen received a cold-storage warehouse as part of a tenant’s bankruptcy reorganization. Larsen died in 2008 and was succeeded in business by his son, Lance, who is still president and CEO.

Lance Larsen deferred questions to Bill Hendricksen, president of Lineage Logistics.

The company has made “no decisions yet” as to what operations will continue from the 10-month-old headquarters of Millard Refrigerated Services, Hendricksen said. The World-Herald reported last May that about 90 Millard Refrigerated employees moved into the newly constructed building that is part of the Sterling Ridge development near 132nd and Pacific Streets.

The building is not part of the sale and still will be owned by the Larsen family.

“Lance has leased us a part of the (headquarters) building to continue to operate the business from there, but it’s too early to say what we’ll do,” Hendricksen said. The company has a “multiyear” lease term at the new building, a Larsen family spokesman said.

County property records show the 90,119-square-foot building had an assessed value of about $10.1 million in 2013.

Ron Margulis, a spokesman for Millard Refrigerated, said some headquarters staff, including chief financial officer Brian Vinchur, will work with the Larsen family in managing real estate assets and another business enterprise that was not included in the acquisition. Millard Maritime is a marine port near Mobile, Ala., built in 2003 and owned by Millard Refrigerated.

The company’s lead sales and human resource executives, Tim Smith and Sean Kimble, will work for Lineage.

Across 30 locations in 16 states, Millard Refrigerated currently employs about 2,000 people, including 160 in Nebraska. There are two warehouses in Omaha and one each in Lincoln and Grand Island.

The company also employs 215 people across five locations in Iowa.

Lineage Logistics has 69 locations in 12 states with 3,400 employees.

The acquisition is by far Lineage’s largest ever, but the company has been built through a series of other acquisitions. With the help of owner and investor San Francisco-based Bay Grove Capital, Lineage has combined nine regional cold-storage and distribution companies since it was formed in 2008.

Larsen will join the company’s board of directors and, like previous owners of Lineage-acquired operations, will also have an equity stake in the company.

“It’s really a company of owners,” Hendricksen said.

On top of acquisitions, a number of which are in the works, Lineage has three facilities totaling 842,000 square feet under construction in California.

With a combined 569.5 million cubic feet of capacity, post-acquisition Lineage will remain the second-largest company of its kind, behind Atlanta-based Americold. That company has about 958.5 million cubic feet of capacity worldwide.

The latest acquisition gives Lineage Logistics more than 9 percent market share in an industry that had revenues of $4.3 billion in 2013.

Lineage expects to close on the acquisition of Millard Refrigerated within 30 days.

Hendricksen said rebranding will take about six months and systems integration about a year.

And although the 51-year-old Millard Refrigerated brand built by Larry Larsen may fade, the company’s legacy should remain visible in Omaha.

“We look forward to being part of the Omaha community for years to come,” Hendricksen said.

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