OVERLAND PARK, Kan. — LTL giant YRC Worldwide escaped the depths of bankruptcy yet again after reaching a debt-for-equity exchange with its bondholders last week.
The struggling company received tenders for approximately $470 million in par value, representing approximately 88 percent of the company’s outstanding notes, before the Dec. 31 deadline.
In return, noteholders will get 37 million shares of YRC common stock and 4.346 million of Class A convertible preferred stock, which together on a converted basis, will represent 94 percent of YRC total issued and outstanding common shares.
The company had to complete the swap by Dec. 31 to pay off $19 million in interest due, or its "liquidity position would become unsustainable," the company said, and it would have been forced to file for bankruptcy protection.
"The success of this note exchange marks a major turning point for YRC Worldwide — with our significantly restructured balance sheet and enhanced liquidity, we will move forward from a more solid financial foundation," CEO Bill Zollars said in a statement.
The Teamsters union had been putting pressure on YRC bondholders to agree to the deal to save 30,000 jobs.
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