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.
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Toby hanson
Neither company wants the terminals, they want the real estate. They both already have nationwide networks
James west
UPS 340,000 in union dues, and everybody is paying there dues. ABF 8000 plus and union dues, and everyone is paying there dues.Tforce 10,000 plus and union dues, and everybody is paying there dues. Xyellow freight 22,000 union workers, maybe 10,000 was paying there union dues. Why should Obrien and his brass care about yellow going under. Also non-union company may get a few out of, how many ever thousands that’s not able to retire.
James west
Over 50% of the so call union members ask for this, now live with it…… and Obrien didn’t care neither, because his eyes is on Amazon. This is the second union company I work with the end being closing the doors.
Freight Zippy
More proof that a Teamster LTL Carrier is worth more dead than alive.
The Teamsters Union placed 30,000 people out of work and are no where to found to helping them get their lives back together???
We are seeing the end of unionized LTL… and another reason to avoid unions.
Dennis Stout
You should really not worry about who buys what building and how much its for .
How about taking care of the people who really got screwed over by the mess
Everyone has seem to forgotten about that so if you write about that
James west
OD , or Estes will become the new yellow nationwide, non-union. And on top of that the darren hawkers, and his board members is still going to get there millions after everything is settled. To all the X yellow employees who was complaining about them getting bonuses, they are still going to get them, and many of you all who couldn’t retire, that was making between 56 and 150,000 driving a forklift , don’t you feel stupid? The old people’s use to say the bird in the hand is better than trying to catch the one in the bush, because you end up not having neither one of them.And to all the Stewart’s that was side hustling with filing grievance, talking about let them shut the Damm doors, now what?
Zud
My take is OD saw what I think ESTES was making a run at it but put it up another dollar level in to block other players getting the opportunity to go National without throwing alot of cash to do it. Waiting on Swift/Knight to make some news but I would think the US Express purchase might have been bad timing on this opportunity. Let’s see how aggressive this gets.
mark
Scabby Companies are lining up to buy with the $$$ they steal from their employee’s