Port East Transfer, Cowan plan to merge

February 04, 1992|By Ted Shelsby

Two Baltimore-area transportation companies announced merger plans yesterday that could lead to the formation of a publicly owned company in Baltimore with sales of $100 million a year.

"This is a major happening in transportation," Edwin F. Hale Sr. said yesterday in announcing plans to combine his Port East Transfer Inc. with Cowan Transportation Inc., owner of Ty Pruitt Trucking.

The merger also would include Hale Container Line Inc., a barge company owned by Mr. Hale that moves more cargo than any steamship line operating out of Baltimore.

"It will make a company that is highly capitalized, more competitive and an efficient carrier both on land and the sea," Mr. Hale said.

He said he was not acquiring Cowan and that no money was changing hands.

The merger will create AtlanTrans, a company with more than 500 trucks, 800 employees and terminals from Boston to Jacksonville, Fla., he said.

Without benefit of a college degree or ties to Baltimore's old-line business community, Mr. Hale has become one of Maryland's more successful and visible businessmen.

He gained public attention through his purchase of the Baltimore Blast soccer team and his hostile takeover last year of Baltimore Bancorp, the parent of the Bank of Baltimore.

His plan calls for his transportation company to merge with Cowan by March. The combined company will hold a public stock offering in the fall, Mr. Hale said.

He will be chairman of the combined transportation companies. Joseph W. Cowan, president of Cowan Transportation, will be president and chief executive of AtlanTrans.

Mr. Hale said both companies "are extremely profitable" and "are doing well in today's economy." Although he declined to disclose profits for the companies, Mr. Hale said they "were doing well." He said annual sales at each company range from $45 million and $50 million.

Mr. Hale said the plan is to expand AtlanTrans "one city at a time." But he said he expects it to be serving ports along the Gulf Coast and the West Coast within five years.

Mr. Cowan said Port East and Cowan Transportation have been competitors for 16 years and that the two companies operate a combined 21 trucking terminals, 11 of them owned by Cowan.

Mr. Cowan said the plan is to consolidate overlapping facilities in Columbus, Ohio; Pittsburgh; Norfolk, Va.; Charleston, S.C.; Savannah, Ga.; and Jacksonville, Fla., which would eliminate seven terminals.

Mr. Hale said none of the operations in this area is expected to be closed and that the merger is not expected to eliminate jobs here. He estimated that 60 percent of the employees of the two companies are in Baltimore. Systemwide, he said, about 20 jobs might be eliminated.

Proceeds from the public offering would reduce the company's debt and finance its expansion, Mr. Hale said.

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