Greg Lehmkuhl, president and CEO of Lineage Logistics, says his company is one of the largest Michigan-based companies you likely never heard of.
How big? Well, the Novi-based cold storage warehousing and logistics enterprise annually handles more than 58 billion pounds of poultry, potatoes, bread, pork, beef, vegetables, and other food items around the world — about one-third of the nation’s and 8 percent of the world’s food — before it gets to grocery stores, restaurants, hospitals, military bases, and schools.
It owns 48 million square feet of real estate — worth $15 billion — and has 60 port facilities around the world, operating more than 310 facilities in 12 countries worldwide.
The operation got its roots in Seattle when the New York private equity company Bay Grove acquired a single cold storage facility in 2008 with nearly 100 employees, and less than $10 million in annual revenue.
After a year of observing the business, owners Kevin Marchetti and Adam Forste set about transforming Lineage Logistics into “the most dynamic company in the cold storage industry,” Lehmkuhl says. They got involved in the Global Cold Chain Alliance industry association to learn more about their new industry as well as identify future acquisition partners.
“The industry at the time was very much a cottage industry, comprised of many family-owned, smaller regional enterprises,” Lehmkuhl says. “Then customers started requiring these businesses to be more sophisticated in terms of technology and with a broader scale.
“(The founders’) vision for the industry was far more innovative, more tech-savvy, more financially savvy, and more institutionalized, and they consolidated,” he says.
To that end, the company made six acquisitions between 2009 and 2014, including Millard Refrigerated Services, which gave them a national footprint for the first time.
The next year, the partners hired Lehmkuhl away from Con-Way Freight, where he was president. At the start, he called a halt to acquisitions for about a year while he stabilized the company, put a new team in place, and updated the technology, including what he calls the Data Lake — which integrates and unifies all of its business data. It also allows any new acquisitions to be easily added.
A native metro Detroiter, Lehmkuhl, along with several key managers from the area, decided to move the company’s headquarters from the West Coast to Novi in 2017. Soon after, an acquisition spree began in full force.
In 2018, Lineage Logistics picked up Yearsley Group Ltd. in the U.K., Service Cold Storage in Wisconsin, four warehouses in the southeast and eight temperature-controlled warehouses from U.S. Growers Cold Storage, and expanded its warehouse and distribution facility in the Dallas-Fort Worth market.
The following year, Lineage acquired New Jersey’s Preferred Freezer Services and two facilities from Van Soest Coldstores, an organization based in the Netherlands. Also in 2019, the company launched Lineage ON DEMAND, a truckload transportation service that guarantees 24/7 freight coverage for its customers.
So far this year, in the midst of the COVID-19 pandemic, Lineage acquired Maines Paper and Food Service Inc. in Cleveland, Henningsen Cold Storage Co. in Oregon, Emergent Cold in Australia, New Orleans Cold Storage, and Ontario Refrigerated Services Inc. in Canada.
“Our goal has never been to be the largest; it’s been to be the most valuable to our customers,” Lehmkuhl explains. “It’s to be the most capable, with the best locations and best services.
“Our goal is always to fulfill our mission of being the most dynamic company in the industry, reimagining the industry, recreating how business is done within the cold chain, being a great place to work, and fostering professional growth.”
In addition to growing through acquisition, Lineage continues to invest in and expand its current operations. It presently is expanding 20 buildings around the world at a cost of more than $1 billion.
“When we’re looking to grow, it’s always about what geographies do our customers need us to be in most, and what services do they need us to provide,” Lehmkuhl says. “We are an extremely purpose-driven organization. Our mission is to transform the cold supply chain, to eliminate waste, and help feed the world. Everything we do is about sustainability; (it’s) about using lean principles to keep cost and waste out of our operation.”
Lehmkuhl says he expects to announce four more acquisitions this year, and nine additional purchases have yet to close.
How do they do it?
“We have great private equity partners in New York and institutional investors,” Lehmkuhl says. “No matter what is happening in the world, people are going to consume the same amount of calories year over year. Our investors see us as incredibly high gross. We’re recession-resistant. We have years and years of growth ahead of us.”
