After 99 years in business, the trucking company, Yellow, will liquidate its assets in a Chapter 11 bankruptcy filing. Paul Page and Soma Biswas report for The Wall Street Journal:
Yellow, the 99-year-old trucking company, filed for bankruptcy and is closing the business, falling victim to mounting debt including a government loan and a standoff with the Teamsters union.
The bankruptcy follows years of struggles for the Nashville, Tenn.-based trucker as it tried to address the debt it accumulated through a series of mergers and a $700 million federal Covid-19 relief loan during the pandemic. On July 30, the company shut down its operations and laid off a large number of workers.
“It is with profound disappointment that Yellow announces that it is closing after nearly 100 years in business,” Chief Executive Darren Hawkins said in announcing the filing for chapter 11 bankruptcy protection late Sunday in U.S. Bankruptcy Court in Delaware.
Hawkins said the business intends to fully pay back the federal loan, which was given to the company in 2020 because of what officials at the time said was Yellow’s crucial role in national security as a transportation provider to the Department of Defense.
Whether the government recovers the money it lent would likely depend on how much Yellow raises by selling real estate and other assets in bankruptcy. But some lawmakers and analysts have said taxpayers could lose money. The Treasury Department took a 30% stake in Yellow as part of that aid package and that holding could be wiped out.
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