Estes Selected as Stalking Horse Bidder for Yellow's Terminal Assets
Estes has been officially approved as the real estate stalking horse bidder for Yellow's terminals, setting the minimum valuation for these assets in the bankruptcy proceedings. This move ensures that Yellow, the bankrupt carrier, can cover its substantial debt, which includes $1.2 billion owed to its largest lenders, with a significant portion coming from the Treasury Department. Estes expressed satisfaction with the court's decision, emphasizing the mutual benefits of their transaction for both Estes and Yellow's bankruptcy estate. The breakup fee and expense reimbursement represent valuable advantages for Estes as the stalking horse bidder, particularly when outbidding longtime competitor Old Dominion Freight Line in the bidding war for these terminal assets.
Old Dominion had previously escalated the bidding war by offering $1.5 billion, surpassing Estes' initial $1.3 billion bid for the properties. Notably, other bidders pursuing property deals are not guaranteed any compensation in this process. As Yellow prepares for asset sales and the winding down of its operations, the court has also authorized its lenders to extend a $100 million loan. Meanwhile, the International Brotherhood of Teamsters, which Yellow had sued before its bankruptcy, is advocating for federal government scrutiny of the bankruptcy proceedings on behalf of its 22,000 members who lost their jobs. The Teamsters have called for Senate hearings to investigate the circumstances surrounding the carrier's collapse, particularly criticizing executive bonuses while worker pension payments were deferred.
Companies have invested nearly $2 billion to acquire terminal assets from Yellow, comprising 128 properties and 25 leases.