June 28 (Bloomberg) -- Arkansas Best Corp. surged to the highest price in almost two years after Teamsters at the trucking company approved a five-year contract that will reduce labor costs.
Arkansas Best jumped 15 percent to $22.95 at the close in New York, the highest price since August 2011.
The International Brotherhood of Teamsters at ABF Freight System Inc., Arkansas Best’s largest unit, voted in favor of an agreement, which included a 7 percent cut in wages, the union said in a statement yesterday. A majority of the supplements to the pact were also passed, and those that require additional action don’t impact the financial terms that have been ratified, according to a separate statement by Arkansas Best.
Shares of Arkansas Best have doubled this year on prospects that YRC Worldwide Inc. would revive a rejected bid to purchase the Fort Smith, Arkansas-based company. Arkansas Best turned down the takeover in April, saying it was focused on “labor negotiations as well as other strategic and operational initiatives” that made it difficult to consider an offer at the time, according to a regulatory filing.
Arkansas Best said in its earnings release in April that a “more rational” labor agreement will enable the trucking company to be far more competitive with its cost structure.
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