Struggling transportation giant YRC Worldwide announced a $536.8 million debt for equity exchange offer Monday that company officials hope will steer the firm to solid financial ground.
YRC officials said that if the offering does not work, the firm will likely file for bankruptcy and if Chapter 11 does not work, liquidation might be the only option.
The publicly traded firm recently reported losing $158.7 million during the third quarter, or $2.67 per share. Shares in YRC have slid 59 percent since the start of the year and 71 percent from last November.
YRC, the parent of such trucking companies as Roadway, Yellow, Holland and New Penn, said it will buy back just under $537 million in debt notes with shares of the company’s common stock and new Class A Convertible Preferred Stock equal to 95 percent of its current shares. The deadline for the offering is Dec. 7, though the firm acknowledged that this could be extended.
Officials of the Overland Park, Kansas-based firm said in a statement that YRC believes the exchange will improve the company's capital structure, decrease its cash interest expense and enhance its near-term liquidity.
Members of the International Brotherhood of Teamsters working for YRC will receive stock options. This is on top of options worth up to 15 percent of the firm's common stock offered to workers earlier this year for wage and pension concessions.
YRC officials said that if the offering does not work, the firm will likely file for bankruptcy and if Chapter 11 does not work, liquidation might be the only option.
The publicly traded firm recently reported losing $158.7 million during the third quarter, or $2.67 per share. Shares in YRC have slid 59 percent since the start of the year and 71 percent from last November.
YRC, the parent of such trucking companies as Roadway, Yellow, Holland and New Penn, said it will buy back just under $537 million in debt notes with shares of the company’s common stock and new Class A Convertible Preferred Stock equal to 95 percent of its current shares. The deadline for the offering is Dec. 7, though the firm acknowledged that this could be extended.
Officials of the Overland Park, Kansas-based firm said in a statement that YRC believes the exchange will improve the company's capital structure, decrease its cash interest expense and enhance its near-term liquidity.
Members of the International Brotherhood of Teamsters working for YRC will receive stock options. This is on top of options worth up to 15 percent of the firm's common stock offered to workers earlier this year for wage and pension concessions.
