Tech
Trucking firm Estes Express submits $1.3 bln bid
Trucking firm Estes Express submits a $1.3 bln bid for Yellow's shipment centers
Trucking firm
Lawyers for Estes Express, a trucking firm, have submitted a bid to acquire the shipment centers of bankrupt Yellow Corp, according to a hearing Thursday in Wilmington, Delaware, according to Allyson Smith, the company's attorney.
Smith said that while Yellow was in the process of negotiating various offers for bankruptcy financing, Estes offered to provide a loan to the company. However, the company chose to proceed with a loan from hedge fund Citadel, which is the largest shareholder in Yellow.
The new loan provides for a 180-day window for Yellow to seek higher bids for their real estate assets and to sell their fleet of trucks. According to Smith, the Estes offer for the company's shipping terminals is sufficient to cover all of the company's pre-bank bankruptcy debt, including the over $700 million it owed to the United States Treasury Department for a loan to cover the costs of the 2020 pandemic relief.
In recent days, Citadel has purchased approximately $500 million of the debt owed by Yellow to Apollo Global Management.
Apollo had initially offered to finance Yellow’s bankruptcy with a loan of $142,5 million but dropped out after other lenders offered lower fees and higher interest rates.
According to Citadel, the new financing offered by MFN will reduce Yellow’s fees by $27 million to $40 million when compared to the Apollo loan. The new financing will also give Yellow twice the time it needs to sell assets.
Once the details of the new financing are agreed upon, Yellow will present the new financing to Judge Goldblatt.
Trucking firm
On Aug. 6, Yellow filed for bankruptcy with little more than $39 million in cash on hand. The company said the cash would not be sufficient to run a “months-long” bankruptcy sale for 12,000 of its trucks, properties, and other assets, the company said.
The company attributed its bankruptcy to a labor dispute it had with the I.B.T.O., which represents 22,000 of its roughly 22,000 employees. The union claimed the company “mismanaged” its way into bankruptcy.
