INDIANAPOLIS, Oct. 2, 2018 /PRNewswire/ -- Celadon Group, Inc. ("Celadon," the "Company," "we," or "us") (OTCPink: CGIP) today announced it has entered into an agreement to sell its approximately 49.9% equity interest in 19th Capital Group, LLC ("19th Capital") to an affiliate of Element Fleet Management ("Element") for nominal value. The sale is expected to close during the quarter ended December 31, 2018 and is subject to customary closing conditions.
19th Capital provides equipment financing to owner-operator drivers and private fleets. Celadon acquired its interest in 19th Capital in December 2016 as part of establishing a joint venture with Element. Celadon initially recorded the value of its investment as $100 million. On April 2, 2018, the Company announced that it expected to reduce the carrying value of its investment in 19th Capital and that the restated carrying value of such investment could be as low as zero. The sale price for Celadon's interest in 19th Capital under the sale agreement is materially consistent with this expectation and the sale is not expected to materially impact Celadon's assets, results of operations, or cash flows. Due to its previously disclosed and ongoing audit and restatement processes, the Company is not in a position to provide a more detailed assessment of the sale's impact at this time.
Paul Svindland, Celadon's Chief Executive Officer, commented "We had identified our interest in 19th Capital as a candidate for disposition as part of our strategic plan to shed non-core assets and refocus on our core trucking operations. We determined that it was the right time to exit our investment and turn over full management to Element."
Celadon Group, Inc. (www.celadongroup.com), through its subsidiaries, provides long haul, regional, local, dedicated, intermodal, temperature-protect, and expedited freight service across the United States, Canada, and Mexico. The Company also owns Celadon Logistics Services, which provides freight brokerage services, freight management, as well as supply chain management solutions, including logistics, warehousing, and distribution.
This press release contains certain statements that may be considered forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended and such statements are subject to the safe harbor created by those sections and the Private Securities Litigation Reform Act of 1995, as amended. Such statements may be identified by their use of terms or phrases, including "expects," "expected," "will," "would," "could," "intends," "believes," "anticipates," "future," and similar terms and phrases. Forward-looking statements are based upon the current beliefs and expectations of the Company's management and are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, which could cause future events and actual results to differ materially from those set forth in, contemplated by, or underlying the forward-looking statements. In this press release, statements relating to the closing of the sale of Celadon's interest in 19th Capital, the timing of such closing, the expected reduction and restatement of the carrying value of Celadon's interest in 19th Capital, and the impact of the sale on Celadon's assets, results of operations, and cash flows, among others, are forward-looking statements. Actual results may differ from those set forth in the forward-looking statements. Factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to, the risk that the actual restated financial statements differ materially from any estimates included in this press release, and the risk that the closing of the sale described in this press release does not occur, is delayed, or is consummated on terms that differ materially from those disclosed in this press release. Readers should review and consider these and other factors that could impact results as provided in various disclosures by the Company in its press releases, stockholder reports, and filings with the SEC.
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SOURCE Celadon Group Inc.