JOC Staff | Dec 27, 2011 3:06PM EST
Regional operator Cross Creek Trucking is shut down this week after federal safety regulators withdrew the company’s authority eight months after Integrated Freight acquired the business.
Virtually all the employees at the Oregon-based provider of less-than-truckload and truckload services company, including more than 200 drivers, were laid off after the Federal Motor Carrier Safety Administration posted a notice Dec. 19 labeling the company’s operating license inactive.
According to published reports, parent Integrated Freight of Sarasota, Fla., had sought to secure a $3.4 million loan to restructure the business.
A former executive at the company, speaking on condition of anonymity, said the FMCSA withdrew Cross Creek’s license after the company failed to post required insurance.
A person answering the phone at the headquarters of Integrated Freight said the offices were closed, and officials did not immediately return a call for comment.
FMCSA records showed Cross Creek has posted “$0” of the $750,000 in insurance required.
Integrated Freight is largely a holding company for a variety of trucking operations brought in through acquisition. The company purchased privately owned Cross Creek on April 1, 2011, and the Cross Creek business counted $7.6 million in revenue in the fiscal quarter ending June 30, a 6.7 percent improvement over the year before.
But Cross Creek was barely profitable, Integrated Freight said in a filing with the Securities and Exchange Commission, and the transaction costs from the acquisition, along with higher fuel costs, added $795,000 to the $1.8 million loss from continuing operations Integrated reported in the quarter.
If Cross Creek shuts down permanently, it would be the second of Integrated Freight’s acquisitions to close. The company lists Triple C Transport, acquired in 2010, as a discontinued operation and said it is now engaged in legal action against the former owners.
