YRC Completes $300 Million Refinancing
YRC Worldwide Inc. said it has moved forward in the refinancing of its debt by completing a multi-step transaction worth about $300 million.
A total of $250 million of common and preferred stock was issued to retire convertible notes that were outstanding. In addition, the company late in Jan. 31 said $50 million in convertible notes were exchanged or converted into stock. In addition, pension fund obligations have been extended to 2019.
YRC’s total debt, including the latest transaction, was $1.35 billion as of its latest earnings report. The refinancing moved forward following last month’s approval by the Teamsters union of a contract extension into 2019. Lenders insisted on that extension to provide more financial certainty as debt matured over the intervening period.
“Beginning in late 2011, this management team set a very deliberate course to stabilize the company. While we are not yet done with our operational turnaround at YRC Freight, today’s equity investment and subsequent reduction of approximately $300 million in debt is an incredible validation of the hard work and commitment of every single YRCW employee,” Jamie Pierson, chief financial officer of YRC Worldwide, said in a statement.
Pierson said the company expects to refinance the rest of its debt in mid to late February.
The contract extension continued a 15% pay cut and lower pension contributions for 26,000 workers at the company that ranks No. 5 on Transport Topics Top 100 For Hire Carriers in the U.S. and Canada.
|By Rip Watson|
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