YRC Worldwide is one step away from completing its financial restructuring by a July 22 deadline, a key official at the $4.3 billion trucking company said Monday.
That sale is under way, and should be finished on schedule, said John Lamar, YRCW’s chief restructuring officer and lead director. “With that being completed, all the key milestones will have been met, and we expect to have all of the pieces in place to close by July 22,” he said.
The company already received a $75 million boost from its lending group in the new $400 million asset-based loan, which replaces a $325 million ABS agreement.
“It has an increased size and increased advance rate” on receivables, Lamar said in an interview. “The overall impact is to increase the liquidity of the company so we can continue our growth plans as well as capital expenditures going forward.”
The $400 million loan agreement demonstrates lenders’ commitment to keeping YRC running through what looks to be a slowdown in the economic recovery.
YRC Worldwide, the second-largest LTL operator, has lost more than $2.7 billion since 2006, including $322 million in 2010 and $102 million in this year’s first quarter.
The company has narrowed its losses year-over-year significantly, but also lost more than half the revenue it had in 2006, when it was a $9.9 billion company.
Three rounds of wage and benefit concessions from the Teamsters union and a $470 million debt-for-equity swap steered the company clear of bankruptcy in 2010.
The financial restructuring would see it through 2011 and lock labor and finance agreements in place that would lend YRC more financial stability through 2015.
The company has gained shippers and freight this year, but its operating costs also are rising. YRC in June resumed contributing to Teamsters employee pension plans.