Less-than-truckload carrier Old Dominion Freight Line entered a $1.5 billion bid for Yellow Corp.’s terminals, according to a Friday filing in a Delaware bankruptcy court. The new offer exceeds the $1.3 billion bid from LTL peer Estes Express Lines, which was revealed at a Thursday status update.
The offer for the 166-terminal portfolio is a stalking horse purchase agreement, wherein the bidder sets the floor for the value of the assets to be sold out of a bankruptcy estate. The properties will still undergo a marketing and sale process in which higher offers from other parties may be accepted.
The terms provide a maximum breakup fee of $26 million and up to $2 million in expense reimbursement. Old Dominion (NASDAQ: ODFL) is required to make a 5% deposit. The bid remains effective for 180 days.
The Thursday court proceeding also named bankruptcy financing lenders.
Hedge funds Citadel and MFN Partners will provide $142.5 million in debtor-in-possession (DIP) financing, which will give Yellow’s estate the funds necessary to liquidate assets. The deal also includes an additional commitment from MFN for a delayed draw of up to $70 million.
MFN acquired a 42.5% equity stake in Yellow ahead of its shutdown.
Citadel recently bought Yellow’s term loan from Apollo Global Management (NYSE: APO) after superior DIP financing offers came forward following Yellow’s Aug. 7 bankruptcy filing. Apollo’s DIP deal was said to be the only viable offer provided to Yellow prior to the Chapter 11 petition.
A representative from Old Dominion was not immediately available for comment.
More FreightWaves articles by Todd Maiden
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- Estes sets floor to buy Yellow terminals at $1.3B
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Had A Good Job
Would love to know how many “ I can get A job tomorrow “ Yellow Teamsters are actually working. Lots of the non-union carriers are not even looking at the former Yellow employees, they don’t want their Union mentality in their workplaces.
Yellow Teamsters, what do think of Sean O’Brien and your Teamster leadership now???
Julie
It is amazing how they are bragging on Ups contract at the expense of closing Yellow. Everyone should sue O’Brien and the locals to demand every union fee they ever paid. He and every local will go down in history as the worst Union President ever !!!! They abandoned working on the Yellow contract knowing the Yellow higher ups were stealing money and were in financial hiatus way before talks began. That is why they delayed going to the table . It was all in the plan . Amazon run from the union! They are a joke and didn’t even help anyone get help getting new jobs . People lost their lives behind this . They will be held accountable on judgement day !
Freight Zoomer
So many anti-union bootlickers still showing up in these comments huh? Commenting multiple times at that. Get over it and remember how much Yellow took from its employees over the years, promising to give back only to walk it back and pocket bonuses for their C-suite.