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YRC Worldwide spikes 10.6% AH, Teamsters agree to tentative deal

  • YRC Worldwide (YRCW) shares spike 10.6% AH after the Teamsters Union reaches a tentative agreement with the company subject to ratification. The new deal follows negotiations after an initial proposal by the company was rejected by union members.
  • Teamsters president Jim Hoffa: "Since the acknowledgement this week from YRC that ‘re-voting the rejected proposal was not an option,’ we proceeded with round-the-clock negotiations to address the concerns of the members and materially revise the rejected proposal while, at the same time, providing a way for the company to pursue its debt reduction and refinancing arrangements."
Comments (2)
  • Michael Bryant
    , contributor
    Comments (5366) | Send Message
     
    So...........will in be ratified? It is "subject to ratification." I hope it does get ratified, because I don't know what (YRCW) will do if it doesn't.
    17 Jan, 10:21 PM Reply Like
  • Transportation Junkie
    , contributor
    Comments (29) | Send Message
     
    My issue with YRC is that in a low-margin business, debt service is very challenging. As a result, capital spending is way off, employee satisfaction is off, and some of the better talent has moved on elsewhere. Add to it an unmotivated workforce as the result of wage cuts, and you have a downward spiral. We saw a lot of this in the early 80's with deregulation, with carriers failing right and left. Roadway at one time was a debt-free colossus. Bill Zollars and his empire building took two once proud (but very different culturally) carriers and destroyed the brand equity it had taken decades to build.

     

    With that debt burden, I just don't see how they can get out from underneath. They have already erased the value of the old equity with the dilution of the shares and the reverse 1:25 stock split. The pack they are carrying still is too heavy a burden.
    21 Jan, 08:11 AM Reply Like
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