When Yellow abruptly shuttered its operations in the summer and filed for bankruptcy protection, few thought that a buyer would emerge and try to revive the long-troubled trucking giant.
But a prominent trucking executive has assembled a last minute plan to acquire Yellow out of bankruptcy — a proposal that seeks not only to rehire many of the company’s employees but also to work with their union, the International Brotherhood of Teamsters, to create a healthy business.
The plan rests, however, on getting the Treasury Department to allow Yellow to postpone repayment of a $700 million rescue loan that it made to the company in 2020. But the Treasury may not accept the plan because there are legal obstacles to extending the loan. And, it stands to be repaid sooner under the plan that Yellow has already filed in the Delaware bankruptcy court, which involves selling the company’s terminals and other assets to raise hundreds of millions of dollars in cash. Some trucking analysts say reviving Yellow will be hard because many of its customers will have moved on to other trucking companies that are much better run than the old Yellow.
But Sarah Riggs Amico, the trucking executive leading the deal, said only her plan could bring back thousands of jobs, adding that she had the experience to build a leaner company in partnership with the Teamsters and assemble an executive team that can win back customers.
“Restructuring Yellow provides an opportunity to bring back tens of thousands of fair-wage, union truck-driving jobs while bolstering America’s supply chain,” said Ms. Riggs Amico, the executive chairwoman of Jack Cooper, a private auto-hauling trucking company. “Who wouldn’t find that a worthy effort?”
Under the proposal, Ms. Riggs Amico’s group would extend the Treasury loan so that it would be repaid in 2026 instead of next year, according to a person familiar with the bid. The group would also borrow $1.1 billion to pay off other secured creditors and bankruptcy lenders, and provide the new company with cash to operate. And it would issue $1.5 billion of preferred shares to unsecured creditors — the biggest of which is the Central States Pension Fund — that don’t get all their claims paid in bankruptcy. The Central States fund would get some $500 million of the preferred shares, according to the plan, far less than the $4.8 billion that Yellow owes it.
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