YRC Worldwide Plummets on Restructuring Plan

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Trucking company YRC Worldwide (YRCW) fell 21% on Monday after the company announced it had come to an agreement in principle with lenders and other stakeholders to restructure the company. The move could result in “a very substantial dilution of existing equity holders,” the company said in a statement, as some of its debt becomes converted into equity. In an interview, Chief Restructuring Officer John Lamar said “the exact amount [of share dilution] has yet to be quantified.”

Under a deal it had made with the Teamsters last year to slash compensation costs, YRC had to come to a restructuring agreement by Feb. 28. The deal agreed to in principle today met that obligation, though the details still need to be worked out. The deadline for final documentation is April 29.

There are some items that still need to be worked out,’ Lamar said.



Original Article Source by Barrons.com