v3.26.1
Business Combinations
 6 Months Ended
Jun. 30, 2026
Business Combinations [Abstract]  
Business combinations

Note 3 — Business combinations

 

Acquisition of the Founding Companies

 

On December 21, 2023, Proficient Auto Logistics, Inc. entered into agreements to acquire in multiple, separate acquisitions five operating businesses and their respective affiliated entities to form the Company, as applicable: (i) Delta Automotive Services, Inc. (which converted to Delta Automotive Services, LLC in an F-reorganization on April 29, 2024), doing business as Delta Auto Transport (“Delta”), (ii) Deluxe Auto Carriers, Inc. (“Deluxe”), (iii) Sierra Mountain Group, Inc. (“Sierra”), (iv) Proficient Auto Transport, Inc. (“Proficient Transport”), and (v) Tribeca Automotive Inc. (“Tribeca” and, together with Delta, Deluxe, Sierra, and Proficient Transport, the “Founding Companies”). The closing of the acquisitions occurred concurrently with the closing of the Company’s IPO of its common stock on May 13, 2024. Each of Deluxe, Sierra, Proficient Transport and Tribeca converted into a limited liability company on December 31, 2025.

 

The various agreements to acquire the Founding Companies are briefly described below:

 

  ● The Company entered into a Membership Interest Purchase Agreement and a Contribution Agreement to acquire all of the outstanding equity of Delta for cash and shares of common stock. Delta’s main business is transporting vehicles for automobile manufacturers to their dealers from the manufacturing site, marine port or rail hub, but it also derives a non-insignificant portion of its revenue from delivering used cars from and to auction companies, leasing companies, automobile dealers, manufacturers and individuals, primarily in the Southeast and East Coast of the United States.

 

  ● The Company entered into a Stock Purchase Agreement and a Merger Agreement to acquire all of the outstanding equity of Deluxe for cash, shares of common stock and contingent consideration in the form of an earn-out provision. The earn-out provision that provided that the Company would make earn-out payments, fifty percent (50%) in cash and fifty percent (50%) in shares of common stock, to Deluxe under certain terms and conditions related to Deluxe’s EBITDA for the period commencing on January 1, 2024 and ending on December 31, 2024. No earnout payment was ultimately due under this agreement. Deluxe’s primary business is transporting vehicles for automobile manufacturers to their dealers from the manufacturing site, marine port or rail hub, but it also derives a non-insignificant portion of its revenue from delivering used cars from and to auction companies, leasing companies, automobile dealers, manufacturers and individuals, primarily in the West Coast and South of the United States.

 

  ● The Company entered into a Stock Purchase Agreement and a Contribution Agreement to acquire all of the outstanding equity of Proficient Transport for cash and shares of common stock. Proficient Transport’s primary business is transporting vehicles for automobile manufacturers to their dealers from the manufacturing site, marine port or rail hub, but it also derives a non-insignificant portion of its revenue from delivering used cars from and to auction companies, leasing companies, automobile dealers, manufacturers and individuals, primarily in the South, Southeast and East Coast of the United States.

 

  ● The Company entered into a Stock Purchase Agreement and a Merger Agreement to acquire all of the outstanding equity of Sierra for cash and shares of common stock. Sierra’s primary business is transporting vehicles for automobile manufacturers to their dealers from the manufacturing site, marine port or rail hub, but it also derives a non-insignificant portion of its revenue from delivering used cars from and to auction companies, leasing companies, automobile dealers, manufacturers and individuals, primarily in the West Coast and the Midwest of the United States.

 

  ● The Company entered into a Stock Purchase Agreement and a Contribution Agreement to acquire all of the outstanding equity of Tribeca for cash and shares of common stock. Tribeca’s primary business is transporting vehicles for automobile manufacturers to their dealers from the manufacturing site, marine port or rail hub, but it also derives a non-insignificant portion of its revenue from delivering used cars from and to auction companies, leasing companies, automobile dealers, manufacturers and individuals, primarily in the East Coast and Southeast of the United States.

 

The acquisitions were accounted for using the acquisition method of accounting, in accordance with ASC 805, Business Combinations. Proficient Auto Logistics, Inc. was the accounting acquirer. The tables below present the consideration transferred and liabilities assumed from the acquisition of the Founding Companies based on the respective fair values as of May 13, 2024.

 

The preliminary purchase price allocation was based upon a preliminary valuation, and the Company’s estimates and assumptions are subject to change within the measurement period (defined as one year following the acquisition date). As a result of further refining its estimates and assumptions since the date of the acquisition, the Company recorded measurement period adjustments to the initial opening balance sheet as shown in the tables below. Adjustments were primarily made to property and equipment, operating lease right-of-use assets, goodwill, and deferred income taxes.

 

Total Acquisition Date Amounts Recognized as of May 12, 2025

 

    Delta     Deluxe     Proficient
Transport		     Sierra     Tribeca     Total  
Purchase consideration                                    
Cash consideration paid   $ 31,580,792     $ 35,597,237     $ 82,185,183     $ 17,442,396     $ 10,685,499     $ 177,491,107  
Stock consideration issued     32,888,947       20,907,990       26,575,928       13,949,040       9,000,055       103,321,960  
Contingent consideration – earn-out     —       3,095,114       —       —       —       3,095,114  
Total purchase price   $ 64,469,739     $ 59,600,341     $ 108,761,111     $ 31,391,436     $ 19,685,554     $ 283,908,181  
                                                 
Allocation of purchase price                                                
Fair value of net assets acquired   $ 36,911,739     $ 25,470,641     $ 50,428,659     $ 20,321,662     $ 9,255,115     $ 142,387,816  
Goodwill   $ 27,558,000     $ 34,129,700     $ 58,332,452     $ 11,069,774     $ 10,430,439     $ 141,520,365  

 

The Company recognized intangible assets as follows:

 

    Useful Life   Delta     Deluxe     Proficient
Transport		     Sierra     Tribeca     Total  
Customer relationships   15 years   $ 34,200,000     $ 16,700,000     $ 32,600,000     $ 16,800,000     $ 2,200,000     $ 102,500,000  
Trade names   10 years     1,800,000       2,600,000       4,300,000       2,400,000       1,300,000       12,400,000  
Total       $ 36,000,000     $ 19,300,000     $ 36,900,000     $ 19,200,000     $ 3,500,000     $ 114,900,000  

 

The Combinations resulted in $141.5 million of goodwill consisting largely of the expected synergies from combining operations as well as the value of the workforce. As a result of the types of acquisitions in which the Company engaged for the period April 1 to May 12, 2024, asset, stock acquisitions, and stock acquisitions with a 338(h)(10) election made, the Company expects approximately $120.6 million of the total goodwill reported will be tax deductible. During the measurement period, which is up to one year from the acquisition date, the Company may record adjustments to the fair value of assets acquired and liabilities assumed with the corresponding offset to goodwill. At December 31, 2025, the values of the Founding Companies are complete. Any subsequent adjustments will now be recorded to earnings.

 

On August 8, 2024, PAL Stock Acquiror, Inc. and PAL Merger Sub, LLC, subsidiaries of the Company, executed an Agreement and Plan of Merger (the “Merger Agreement”) with Auto Transport Group, LC, (“ATG,” which was converted to a limited liability company after closing) pursuant to which the Company acquired all of the outstanding equity of ATG to expand the Company’s geographic presence and services offered (which was converted to a limited liability company after closing). ATG provides vehicle transportation and shipping services in the Mountain Western region. The transaction closed on August 15, 2024. The acquisition was accounted for using the acquisition method of accounting, in accordance with ASC 805, Business Combinations. Proficient Auto Logistics, Inc. was the accounting acquirer, and the Company elected to apply pushdown accounting. The table below presents the consideration transferred and the allocation of the total consideration to tangible and intangible assets acquired and liabilities assumed from the acquisition of ATG based on the respective fair values as of December 31, 2024 as well as the measurement period adjustments recorded as of August 16, 2025:

  

    December 31,
2024		     Adjustment     August 16,
2025		  
Purchase consideration                  
Cash consideration paid   $ 28,938,295       (500,000 )   $ 28,438,295  
Stock consideration issued     20,542,136       —       20,542,136  
Total purchase price   $ 49,480,431       (500,000 )   $ 48,980,431  
                         
Allocation of purchase price                        
Fair value of net assets acquired   $ 24,886,502       218,438     $ 25,104,940  
Goodwill   $ 24,593,929       (718,438 )   $ 23,875,491  

 

The Company recognized intangible assets as follows:

 

    Useful Life   Auto
Transport
Group		  
Customer relationships   15 years   $ 22,200,000  
Trade names   10 years     1,100,000  
Total       $ 23,300,000  

 

The acquisition of ATG resulted in $23.9 million of goodwill, consisting largely of the expected synergies from combining operations, as well as the value of the workforce. In this asset acquisition, no portion of the total goodwill reported will be tax deductible. During the measurement period, which is up to one year from the acquisition date, the Company may record adjustments to the fair value of assets acquired and liabilities assumed with the corresponding offset to goodwill. At December 31, 2025, the value of ATG acquisition is complete. Any subsequent adjustments will now be recorded to earnings.

 

Utah Truck & Trailer Acquisition

 

On November 1, 2024, PAL Stock Acquiror, Inc. purchased Utah Truck & Trailer Repair, LLC, (“UTT”), a repair facility located at the ATG headquarters terminal in Ogden, Utah. In February 2025, UTT was renamed to Proficient Repairs Services, LLC. The Company purchased UTT for $4,515,004 in an all-cash transaction to expand the Company’s ability to maintain its revenue generating fleet in the Western region of the country. In connection with this acquisition, the Company recognized $155,458 in net tangible assets and $4,359,546 in goodwill consisting largely of the expected synergies from combining operations as well as the value of the workforce. As a result of this asset acquisition, the Company expects all of the goodwill reported will be tax deductible. At December 31, 2025, the value of UTT acquisition is complete. Any subsequent adjustments will now be recorded to earnings.

 

Brothers Auto Transport Acquisition

 

On April 1, 2025, PAL Stock Acquiror, Inc. purchased all the outstanding equity of Brothers Auto Transport, LLC, (“Brothers”), which provides vehicle transportation and shipping services in the Northeast and MidAtlantic regions of the country. Brothers was purchased for $12,448,011, a combination of cash and stock. In connection with this acquisition, the Company recognized $6,507,610 in net tangible assets which includes $6,338,899 in equipment notes, and $2,220,000 in intangible assets and $3,720,401 in goodwill consisting largely of the expected synergies from combining operations as well as the value of the workforce. As a result of this acquisition, the Company expects all of the goodwill reported will be tax deductible. At June 30, 2026, the value of Brothers acquisition is complete. Any subsequent adjustments will now be recorded to earnings.

 

PVT Truck and Trailer Acquisition

 

On May 27, 2025, Proficient Repairs Services, LLC purchased PVT Truck & Trailer Repair, LLC, (“PVT”), a repair facility located at the Brothers headquarters terminal in Wind Gap, Pennsylvania. The Company purchased PVT for $1,032,995 in an all-cash transaction to expand the Company’s ability to maintain its revenue generating fleet in the Northeast and MidAtlantic regions of the country. In connection with this acquisition, the Company recognized $310,129 in net tangible assets and $722,866 in goodwill consisting largely of the expected synergies from combining operations as well as the value of the workforce. As a result of this asset acquisition, the Company expects all of the goodwill reported will be tax deductible. At June 30, 2026, the value of PVT acquisition is complete. Any subsequent adjustments will now be recorded to earnings.