Friday, December 04, 2009

YRC is confident that deal with bondholders will be approved

YRC Worldwide said Thursday that it is "very confident" shareholders will approve a debt-to-equity swap that would eliminate more than $500 million in debt from its books.

The Overland Park-based trucking giant made the statement after an analyst with R.W. Baird & Co. expressed doubt that the deal with bondholders would muster the necessary votes.

Bondholders would gain control of 95 percent of YRC's common stock in exchange for wiping out the debt.

Shares in YRC closed Thursday at $1.20, down 10 cents.

Analyst Jon A. Langenfeld said the current price of the bond deal is based on an "overly aggressive profit recovery scenario," according to a Journal of Commerce report. The deal faces a Tuesday deadline.

The debt swap is a critical part of YRC's recovery plan. The company has sold assets, laid off workers and gained wage concessions from salaried and union workers.

No comments: