Yellow,
one of the country’s largest and oldest trucking companies, has filed for bankruptcy amid mounting debt and a labor dispute with the Teamsters union.
The stock soared more than 400% last week over the five trading sessions through Friday, even as the company was expected to file for bankruptcy. The shares pointed 25% lower at $2.68 in premarket trading Monday, but are still close to 350% up since Yellow announced it was closing down.
The 99-year-old company filed for Chapter 11 bankruptcy protection Sunday and said it will seek court authorization to make payments such as employees wages, salaries and benefits. Yellow’s (ticker: YELL) closure means the loss of 30,000 jobs. The company described its employees as “unsung heroes throughout the pandemic,” in a statement Sunday.
Yellow said it expects to secure a loan to support it through the marketing and sale process.
“It is with profound disappointment that Yellow announces that it is closing after nearly 100 years in business,” CEO Darren Hawkins said in a statement. “Today it is not common for someone to work at one company for 20, 30, or even 40 years, yet many at Yellow did.”
The company notified the Teamsters union last week that it was ceasing operations and filing for bankruptcy. The union blocked Yellow’s operational overhaul earlier this year, which led to business being lost and challenges in refinancing its $1.3 billion debt maturing in 2024, The Wall Street Journal reported.
Write to Callum Keown at [email protected]
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