Yellow Corp, the troubled trucking company, received court approval for a significant sale of its assets, marking a crucial development in its bankruptcy proceedings. U.S. Bankruptcy Judge Craig Goldblatt, overseeing the case in Wilmington, Delaware, approved the sale of most of Yellow's shipping centers and real estate to various buyers for a total of $1.88 billion. This sale not only represents a "tremendous outcome" for the company and its creditors, as noted by Judge Goldblatt, but also signifies a major turning point in the company's efforts to resolve its financial woes. The proceeds from the sale are substantial enough to cover Yellow's $1.2 billion pre-bankruptcy debt, including a significant COVID-19 pandemic relief loan from the U.S. Treasury Department.
The decision to liquidate its assets in parts, rather than selling the company as a whole, came despite political pressure to keep Yellow intact as a means to preserve jobs. The sale involved divesting 130 shipping centers to various buyers, marking a strategic shift from previous plans to find a single buyer for the entire company. This approach was chosen over alternatives such as the bid led by Sarah Riggs Amico, executive chair of Jack Cooper Transport, who had proposed acquiring Yellow through Next Century Logistics, in an effort that would not involve a merger with Jack Cooper.
XPO (XPO) emerged as the largest buyer in this process, acquiring 28 shipping centers for $870 million. The success of the auction was underscored by Yellow's attorney Allyson Smith, who highlighted that the sale greatly exceeded both the appraised value of Yellow’s real estate and an early offer for its shipping centers. This sale marks a pivotal moment for Yellow, formerly known as YRC, which filed for Chapter 11 bankruptcy protection in August due to a labor dispute with the International Brotherhood of Teamsters union.
While Yellow continues to seek buyers for its remaining assets, including 46 shipping terminals and its fleet of trucks, Amico remains interested in bidding on these assets. Her goal is to rehire a significant portion of the workforce impacted by Yellow's shutdown. The bankruptcy sale, therefore, not only addresses the company’s financial obligations but also opens the door to potential job recovery for thousands of workers.
