Flatbed truckload company Daseke DSKE announced several changes Tuesday, including its CEO's resignation, changes to the board and an in-line financial update.
CEO who led the corporate turnaround resigns
The press release said CEO Chris Easter retired Dec. 31 to attend to family obligations. The company has inserted current board member Jonathan Shepko, a managing partner at private equity firm Stonehollow Capital, to fill the role on an interim basis while a national search is conducted.
Easter joined Daseke in the newly created chief operating officer role in January 2019 as the company embarked on a restructuring plan to improve operations after a decade of acquisitions. Easter then took the helm on an interim basis when founder, chairman and former CEO Don Daseke stepped down abruptly in August 2019. He was named the permanent CEO in February.
"This has been a very difficult decision for me personally, but I have a number of family-related obligations that need my full attention. As a result, I made the decision to retire from Daseke at the end of the year," Easter stated in the press release. "We have successfully executed a dramatic turnaround in our performance while navigating through a global pandemic. Daseke's strategy is sound, the business is performing well and the team is poised to continue forward with this momentum."
The Addison, Texas-based company's turnaround started with the addition of Easter as well as board changes that included operationally focused leadership. The group set its sights on integrating the roughly 20 acquisitions the company made since its 2009 inception. The plans included the consolidation of a separately operated network of carriers, divesting its oil rig transportation unit, disposing underutilized equipment and reducing headcount.
"Among other things, Chris helped to reset our operational strategy and built a solid leadership team with decades of transportation experience. The board is confident in the team's ability to execute on our current strategy and guide Daseke to a bright future. The board respects Chris' decision to retire and we wish him the very best in the future," said Chairman Brian Bonner.
Shepko has held various leadership roles with private equity firms focused on the energy and infrastructure verticals.
"I look forward to leading Daseke during this interim period, with a goal of making further progress on our current strategic path and driving continued operational and financial performance. I expect to be fully engaged with the team and leading the organization with assistance from Brian as if my role were permanent; we must continue our transformation," said Shepko.
New board composition
Daseke announced that it has reached separate agreements with shareholder Lyons Capital, which holds approximately 5% of the company's stock, and former founder Daseke, who holds 28% of the outstanding shares, regarding the board's makeup.
Lyons Capital inserted Grant Garbers to the board effective New Year's Day. The move essentially breaks ties with Daseke investment partner Hennessy Capital, which took the carrier public via a special purpose acquisition company merger in 2017.
Garbers will replace Kevin Charlton, who was the president and COO at Hennessy Capital. Additionally, Daseke Vice Chairman Daniel Hennessy, who is the chairman and CEO at Hennessy Capital, will not be nominated for reelection at the 2021 annual meeting, according to a separate filing with the Securities and Exchange Commission.
Garbers has been a managing director at investment banking firm Harrison Co. since June. Previously he was with Capstone Headwaters in a similar capacity for 13 years. Garbers was also an independent director at Roadmaster Group, which was acquired by Daseke in 2017.
The board plans to elect current director Charles Serianni as chairman following the annual meeting if he is reelected to the board, according to the filing. Serianni is the CFO at waste management company Republic Services RSG, which operates approximately 16,000 trucks daily.
Bonner and the new CEO will be nominated for board seats as well. Board member Kimberly Warmbier has stepped down.
The agreement also calls for Daseke to be renominated to the board at the annual meeting. Daseke was serving as chairman emeritus most recently. The release said that Daseke plans to vote in favor of the company's omnibus share plan, which covers executive equity compensation, and the plan to increase the number of shares that may be granted as awards.
The company announced that it has implemented a share repurchase program to buy back at least 3 million shares of common stock.
"We are pleased to have reached these agreements with Lyons Capital and with Mr. Daseke. We look forward to continuing our constructive relationship with these two large shareholders and appreciate their support for continuing our improvement initiatives and the execution of our current strategy," Bonner added.
In-line financial update
The company also announced it "performed well" during the fourth quarter, achieving its internal forecasts, which are "in line with analyst consensus" expectations for revenue and adjusted earnings before interest, taxes, depreciation and amortization, excluding the positive impact of the divestiture.
Shares of DSKE were up 7% in midday trading Tuesday.
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