Celadon Group

Beginnings

Celadon cofounders Stephen Russell and Leonard Bennett had neither employees nor equipment when they started the Indiana-based company, but they did have one major contract to transport automotive parts to a new Chrysler plant in Mexico. Russell and Bennett named their new company Celadon after reading about celadon pottery, an ancient green-glazed stoneware dating back to the Koryo dynasty (918-1392 A.D.). They hoped their company would be distinctive like the pottery. Celadon did $8 million in business during its first year and was considered a pioneer of the commerce trail between the United States and Mexico.

NAFTA

The passing of the National American Free Trade Act in 1995 was a major break for Celadon, which was in a position to capitalize on the explosion in trade between the United States and Mexico. According to the original NAFTA, trucks from Mexico could enter the United States and move freely within the states bordering Mexico, and even as far north as the California-Oregon border. However, the United States blocked NAFTA just as it was about to go into effect. While the United States contended it had "safety concerns," critics claimed the move was politically connected to the powerful Teamsters Union, which worried that allowing low-paid Mexican truck drivers into the country would threaten U.S. jobs. NAFTA was eventually passed, but drivers were prohibited from hauling their loads to their Mexican destinations. Instead, they had to hand off their loads at border-town interchange points, and Mexican truck drivers took over for the final leg of the run.

Celadon quickly adapted to NAFTA's provisions. It cultivated its relationships with over 15 Mexican trucking companies and allowed these companies to drive its trucks to their destinations within Mexico. Many in the industry feared Celadon's trucks would be confiscated in Mexico, but Celadon hauled shipment after shipment without incident. It credited its solid relationships with the Mexican trucking companies for its success. Celadon became known as the primary NAFTA carrier. The company later acquired the Mexican trucking company Transportacion de Jaguar to assist with cargo transfer at the Mexican border.

Privatization Attempt

After several years of answering to the public, Russell considered the IPO a mistake for Celadon. "Being a private company, you can focus on the long term without worrying about specific quarterly earnings," he explained in the Indiana Business Journal in 1998. Russell also felt Celadon's stock was "unappreciated" on Wall Street. In 1998, Larendo Acquisition Company, a subsidiary of the New York Investment firm Odyssey, planned to acquire Celadon for $259 million, but backed out because it was unable to secure financing. News of the deal falling through caused a 32 percent drop in Celadon's stock.

Accounting Issues

On May 1, 2017 the company announced that COO Eric Meek had resigned after auditor BKD had determined that the financial statements for the 2016 fiscal year “should not be relied upon.” On May 8, the New York Stock Exchange informed the company that it had failed to meet the exchange's listing standard and the company’s stock could be delisted in six months. The noncompliant financials put Celadon into default with its lenders. The company reached a new credit deal with Bank of America on July 3 after agreeing to a host of operating and reporting restrictions. CEO Paul Will announced his retirement on July 13.