Wall Street Journal: YRC In Deal To Cut Levels For Debt Swap

YRC Worldwide Inc. (YRCW) proposed revising the terms of its debt-for-equity and extended it again as it struggles to ward off bankruptcy.

The trucking company is seeking to cut the minimum tender amount to 70% for notes due next year and 85% for two other series of notes. The current acceptance level is 95% and the company said Wednesday that the figure was at 75%.

YRC said Thursday it needs lenders' holding commitments of at least two-thirds under a credit agreement to approve the revision, and announced it has reached a tentative agreement in principal with a steering committee representing more than 67% of the commitments. Changes to the current credit deal would be made in exchange for the approval.

The company is aiming to consummate the debt-swap by Dec. 31, which will allow it to defer about $19 million in interest and fees. YRC said that if it were obliged to make the payment and didn't have access to a credit revolver reserve the company's "liquidity position would become unsustainable."

Shares were up 2 cents premarket to $1.03. The stock was above $3 before details of the highly dilutive debt-for-equity exchange were released last month. Under the deal, bondholders would get a 95% stake in YRC for tendering the notes, which carry an aggregate face value of $536.8 million. The debt would be erased from YRC's books, and the company also would gain access to new liquidity to continue its restructuring and help it weather the downturn.

-By Tess Stynes, Dow Jones Newswires; 212-416-2481; Tess.Stynes [at] dowjones.com;

Get Advice Join TDU Donate

Recent News

Teamster Officers Salary Report

Every year TDU publishes a nonpartisan report on the salaries of Teamster officials and lets members decide who is working hard to earn it—and who may not be. You can download the list here.

How Teamster Salaries Dramatically Changed—and Why

Top Teamster officials once paid themselves nearly $2 million a year in today’s dollars. TDU, the right to vote, and leaders who put members first have brought salaries in line with the rest of the labor movement.

View More News Posts