YRC Worldwide Inc. (YRCW) Chief Executive Officer James Welch asked union leaders to extend a labor accord into 2019 to help the struggling trucker refinance debt.
Welch said the refinancing process must start by Nov. 15, according to a slide presentation shown at a Nov. 5 meeting with Teamsters union leaders. YRC asked the union to reduce absenteeism and provide predictable future wage and benefit increases. Ken Paff, national organizer for Teamsters for a Democratic Union, confirmed the posting.
YRC, which has posted annual losses since 2007, delayed its earnings release this week amid talks on the new labor agreement. The company has almost $1.4 billion in borrowings from what Welch has called “numerous missteps” before he became CEO in July 2011.
“Our lenders will not refinance our debt unless we have a five-year agreement along with an improved cost structure and operational performance,” YRC said in the presentation.
The refinancing process typically takes 90 days and the company must complete it before the first debt payments come due, according to the presentation. YRC has a $69.4 million of convertible bonds maturing on Feb. 15, according to Bloomberg data.
YRC said in the presentation that its market share has dropped to 17 percent from 42 percent in 1995. The presentation shows a graph with two options -- one is refinancing and the other depicts a truck driving over a cliff.
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