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XPO Spinoff, RXO Will Go Public Soon, Start Trading Oct. 27
October 24,
2022 by HFBusiness Staff in Business Strategy, Industry 
The soon-to-be public company RXO Inc. has secured a $100 million term loan needed to pay part of its costs to XPO Logistics Inc. for its impending spinoff. It will start trading on a “when-issued” basis Oct. 27 on the New York Stock Exchange, according to Charlotte Business Journal.
As a part of XPO Logistics, RXO was a first mover 10 years ago to digital brokerage for trucking. The company provides managed transportation, “last-mile” service and freight-forwarding. RXO is now the fourth-largest broker of full truckload transportation.
That technological capacity led to XPO’s decision to spin off RXO from its traditional logistics business.
“I’ve been a part of this business since the beginning — helping to guide our team as we delivered industry-leading growth for over 10 years,” RXO CEO Drew Wilkerson said during an investors' conference this week.
“We’re able to serve customers in all modes of transportation — not just truckload. This increases our customer stickiness and drives long-term growth.”
On Oct. 18, RXO closed on a $500 million revolving credit agreement with banks led by Citibank N.A. RXO said in a U.S. Securities and Exchange Commission filing on Oct. 19 that the deal includes “a five-year $100 million unsecured term loan facility that may be borrowed by RXO in a single draw following (or within one business day prior to) consummation of the spin-off.”
RXO will use that term loan, $355 million in senior notes issued earlier in October and cash on hand to pay XPO $554 million for earlier debts incurred while it was part of the original company. With that payment complete, XPO will spin off RXO as a tech-enabled brokered transportation company on Nov. 1.
“Beginning … October 27, 2022, RXO Common Stock will trade on a when-issued basis on the New York Stock Exchange under the ticker symbol “RXO WI,” the filling says.
The “when-issued” designation is common in spinoffs when the original company intends to award its shareholders shares of the spinoff stock. That is how the RXO deal is structured, with its shareholders receiving one share of stock in RXO for each share of XPO they held as of yesterday.
When-issued stock is used to allow conditional trading in advance of the formal start issue of the new stock shares.
“At the close of trading on October 31, 2022, when-issued trading of RXO common stock will end and on Nov. 1, regular way trading under the ticker symbol “RXO” will begin,” the filing said.