YRC Worldwide Gets $400 Million From Lenders

YRC Worldwide Gets $400 Million From Lenders

Trucking giant YRC Worldwide secured a $400 million asset-based loan facility from its lenders, a key step toward completing its financial restructuring by July 22, the company said Monday.

The three-year, $400 million credit line will help the troubled company ensure its liquidity as it attempts to rebuild operations and purchase new equipment.

Terms of the new loan agreement were outlined in a filing with the Securities and Exchange Commission July 7.

The company’s lenders, led by JPMorgan Chase Bank, will provide the backing in two facilities, one worth $175 million and the other worth $225 million.

Each member of the lending group will provide $58.3 million of the first facility and up to $75 million of the second “last-out” secured loan facility, the SEC filing said.

The new asset-based loan will expire Sept. 30, 2014. The proceeds will be used to refinance YRC’s current ABS facility and provide working capital for the company. The new ABL will give YRC Worldwide more financial breathing room post-restructuring, said John Lamar, chief restructuring officer and lead director.

The facility “helps support our industry's seasonal pattern of revenues and provides the financial flexibility and runroom we need to grow the business,” he said.

The $4.3 billion less-than-truckload operator, which has lost more than $2.5 billion since 2006, lost $102 million in the first quarter and is expected to report a second-quarter loss.

The company has gained shipments this year, but it remains financially vulnerable in a volatile market with rising costs and a slowing economic recovery.

-- Contact William B. Cassidy at wcassidy@joc.com. Follow him on Twitter @wbcassidy_joc.