According to Bloomberg News, creditors led by Apollo Global Management Inc. are close to reaching a deal to provide Yellow Corp. with new funding as the company prepares for bankruptcy.
Shares of Yellow are currently trading at $3.14, up 78%.
As the majority owner of one of Yellow’s term loans, Apollo is in a strong position to offer support and is finalizing an agreement to lead the debtor-in-possession financing for the struggling trucking company.
Yellow has chosen not to comment, while Apollo has not responded to a request for comment from Reuters.
Formerly known as YRC Worldwide, Yellow is the third-largest trucking company in the United States, specializing in “less-than-truckload” (LTL) shipping for multiple shippers in single trailers.
Recently, Yellow managed to avoid a strike by its 22,000 Teamsters-represented workers.
The Teamsters union announced last week that Yellow had ceased operations and would file for bankruptcy due to unsuccessful attempts to reorganize and refinance over $1 billion in debt.
Refinitiv data reveals that Yellow had a total debt of $1.54 billion last year, influenced by a considerable decrease in e-commerce shipments and a broader decline in freight volumes amid the pandemic.
Yellow is faced with $1.3 billion in debt payments due in 2024, including a $567.4 million term loan in June and a $729.4 million U.S. Treasury loan in September.
A correction has been made to this story, removing a reference to a $50 million payment in paragraph 6.
Reporting by Priyamvada C in Bengaluru; Editing by Anil D’Silva and Devika Syamnath