XPO Logistics Inc. XPO 1.25% has sold its truckload shipping business to Canadian trucking company TransForce Inc. for $558 million, the company said Thursday.

Greenwich, Conn.-based XPO, which took the business unit on as part of its $3 billion acquisition of Con-way Inc. last year, said proceeds of the sale will be used toward paying down $5.1 billion of outstanding debt used to make over a dozen acquisitions since 2011.

XPO has been working to reduce its debt and improve cash flow as it integrates the former Con-way fleet, as well as French logistics firm Norbert Dentressangle SA, acquired last year for $3.5 billion, and others. The truckload business was a small part of Con-way’s fleet. Most former Con-way trucks carry loads from multiple shippers, while truckload carriers load up their trailers with a single customer’s freight.

“Even though it’s a good business, it’s only the 19th largest trucking company in the U.S. We’re No. 1, or close to No. 1, in all of our major businesses,” XPO Chief Executive Bradley Jacobs said in an interview. “We’re going to concentrate on growing our value to customers where we’re industry leaders.”

The deal transfers about 3,000 tractors, 7,500 trailers and 29 locations to TransForce, which has also been aggressive in its acquisition strategy. TransForce, which is Canada’s largest trucking company, has expressed interest in expanding its U.S. truckload business.

XPO had previously considered bids for the business unit, but wasn’t satisfied with earlier offers and said in February it would keep and integrate the truckload business. This time, TransForce approached XPO, Mr. Jacobs said.

XPO, which in August set a 2016 target of at least $1.27 billion for adjusted earnings before interest, taxes, depreciation and amortization, said the divested operations were expected to generate $10 million of operating income for the two remaining months of the year. The company will update its financial targets to reflect the transaction next month, when it reports third-quarter results.

Mr. Jacobs said XPO will retain Con-way’s core less-than-truckload business as part of its broad portfolio of logistics businesses. XPO still aims to be a “one-stop shop” for shippers, but will focus on market segments where the company has a significant lead on competitors, he said. XPO will still book truckload services through its brokerage, he said.

Write to Loretta Chao at loretta.chao@wsj.com