SAN FRANCISCO (AFX) -- FedEx Corp. announced Friday that it will pay a 13% higher quarterly dividend and has acquired the less-than-truckload shipping operations at Watkins Motor Lines for $780 million in cash.
The FedEx acquisition of Lakeland, Fla.-based Watkins should close in the first quarter of next year and won't affect 2007's results.
FedEx will rename the operations FedEx National LTL and manage under its FedEx Freight group. The executive in charge of Watkins, Chip Watkins, will be president.
The deal also includes Watkins Motor Lines operations in Canada as well.
Overall, FedEx Freight has annual revenue of $3.5 billion and Watkins' revenue tops $1 billion, according to FedEx.
The increased payout for Memphis-based FedEx lifts the quarterly dividend by 1 cent to 9 cents a share. The dividend is for shareholders of record as of June 12 and will be paid July 3.
FedEx also announced Friday that Daniel Sullivan, 60, the chief executive of its FedEx Ground division, will retire Jan. 5 next year. His replacement is an executive from the company's express operations, David Rebholz, who is 53.
Shares of FedEx dipped 0.1% to $107.57 Friday. This story was supplied by MarketWatch. For further information see www.marketwatch.com.