AAT Carriers sale to Covenant Transport highlights interest in leveraging acquisitions to gain additional specialized capacity

Capstone Partners, a leading middle market investment banking firm, sees growing interest among truckload carriers in gaining entry to more specialized market segments, as exemplified by Covenant Transport’s recent acquisition of AAT Carriers (AAT)—one of the largest nationwide carriers of high-security goods.

Capstone advised AAT on the transaction and says the deal highlights important trends in the transportation mergers and acquisitions (M&A) environment. 

Founded in 2007, AAT Carriers specializes in transporting ammunition, weapons, and other dangerous or hazardous goods. The company provides dedicated service for a diverse group of government and commercial customers—including the Department of Defense (DoD).

Capstone reports that many transportation companies are flush with cash after a sustained freight bull-run and, at the same time, struggle to find incremental capacity to support growth. Strategic capacity acquisitions are a natural outgrowth of this dynamic—particularly in higher-margin segments with perceived barriers to entry. High-security government freight is one such segment.  

“Representing a company like AAT—with truly industry-leading operational metrics—is always a joy,” commented Burke Smith, Managing Director at Capstone Partners. “In this case, AAT Carriers’ strategic focus on supporting our nation’s military made this a particularly special experience. Covenant Transportation will be a fantastic partner to carry this legacy forward.”

Based in Chattanooga, TN, Covenant Transport engineers value-driven supply chains to help customers get products where they are needed through a portfolio of logistics and transportation solutions. Its primary concentrations are expedited, dedicated, warehousing, and managed freight transportation. Covenant Transport is a subsidiary of Covenant Transportation Group, Inc., a holding company for several transportation providers that offer premium transportation services for customers throughout the United States.