YRCW Completes Restructuring Plan
YRC Worldwide has completed its restructuring, a comprehensive, $500 million plan that infused new capital, created additional liquidity, reduced debt and installed a new CEO and board
YRC Worldwide has completed its restructuring, a comprehensive, $500 million plan that infused new capital, created additional liquidity, reduced debt and installed a new CEO and board.
The transaction provides a large boost in liquidity via a $100 million new money investment as well as expanded availability from the company's asset-based lending facilities. It gives YRCW a runway to build on the positive momentum developed over the last six months.
In addition to the financial benefits of the transaction, the company has appointed an entirely new board of directors, including two representatives nominated by the Teamsters.
The newly installed board named former YRC executive James L. Welch to be CEO, succeeding Bill Zollars, CEO since 1999, who stepped down at the completion of the restructuring.
"Mr. Welch brings hands-on institutional knowledge along with an employee and customer-focused approach to a company built on reliability and customer relations," said YRC Worldwide Board Chairman James Hoffman.
Welch has more than 30 years of experience in the transportation sector, many of those at the senior executive level. He most recently served as president and CEO of Dynamex Inc., a provider of same-day transportation and logistics services in the United States and Canada. He began his career with Yellow at the age of 23 and worked his way up to the position of president and CEO (2000-2007).
Also as part of the transaction, the Teamsters Union and TNFINC have negotiated a 25% ownership stake in YRCW for Teamster members.
"The completion of the restructuring is a significant accomplishment in our efforts to preserve good jobs," said Teamsters General President Jim Hoffa, noting the plan is aimed at saving more than 25,000 Teamster freight jobs.
YRC reported a $38.7 million net loss in the second quarter as well as an operating loss because of continuing fees tied to its $500 million restructuring. However, numbers are expected to improve with the completion of the restructuring and the return of customers in the economic recovery.
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