Pacer International Builds Strategic Relationship With Apollo Management; Pacer Sees Continued Growth With Backing of Private Investment Partnership

LAFAYETTE, Calif.--(BUSINESS WIRE)--Feb. 24, 1999--Pacer International (Pacer), the fast-growing transportation and logistics firm, said it has entered into a definitive merger agreement with an affiliate of Apollo Management L.P., a leading private investment partnership based in New York.

Pacer said the transaction will result in a substantially larger equity base for its operations and future expansion. Pacer will retain its name and its entire management team under the new equity-partner arrangement.

Value of the transaction was not disclosed, but Pacer's chief executive officer Donald C. Orris said after the merger takes place Pacer will be funded by combined equity from Apollo and from Pacer's existing management group. He said a revolving credit facility will be available to Pacer for working capital and for acquisition purposes.

"Pacer and its customers will benefit immensely from our relationship with this recognized strategic partner," said Orris. "Together, we will have the resources to achieve our long-range strategic objectives. Our focus is to round out Pacer's transportation and logistics menu for the global, national and regional manufacturers and retailers we serve, and to continue building the volumes and economies of scale that ensure cost-efficiency and consistently high service levels.

"We intend to continue expanding through both internally generated growth and strategic acquisitions," said Orris, whose firm has successfully completed five mergers since December, 1997.

Added Joshua Harris, an Apollo partner: "We've carefully looked at the transportation and logistics industry and believe Pacer is the right platform to take advantage of the industry's strong growth prospects. We are extremely impressed with Pacer and its experienced management team, which has quickly grown the revenue base and made Pacer an industry leader."

ABOUT PACER: Non-asset-based Pacer International provides a broad range of intermodal, trucking and logistics services for manufacturers and retailers -- all available through a single organization. With some 635 employees, it offers a national network of 134 sales agents, access to all major railroads and trucking firms, and a network of drayage companies and more than 815 owner-operators. Pacer is headquartered in Lafayette, California.

ABOUT APOLLO: Apollo Management L.P. is a private investment partnership that has invested in excess of $10 billion since 1990 in a variety of corporate and real estate transactions.

Note: Issued by Potash & Company, Oakland CA

Steve Potash, 510/261-1570