DOW JONES NEWSWIRES
YRC Worldwide Inc.'s (YRCW) logistics unit sold its U.S. dedicated contract carriage business in the trucking giant's effort to pay down debt.
Talk of a possible YRC bankruptcy has circulated for months as the debt-laden company slashed jobs and sold real estate to stay afloat amid weak demand for freight transport. It detailed a $550 million debt-for-stock swap earlier this month, which is meant to put it on firm financial footing.
The $34 million sale, which includes not only the customer contracts but also the trucks and trailers, will help to pay down the struggling trucking company's revolving credit facility. The buyer is privately held Greatwide Logistics Services. The Texas-based company provides national truckload transportation and warehouse distribution services.
"This sale is a strategic move toward a more asset-light business model and aligns resources at YRC Logistics to focus on our core offerings, including transportation, distribution and global services," the segment's president, John Carr, said Tuesday. He said the relevant clients support the move.
Both companies are working to simplify the transition of 600 workers involved in the business.
Last month, YRC Worldwide posted a narrower third-quarter loss on fewer charges as it announced the swap plan.
YRC shares were down 4.1% at $1.16.
-By Joan E. Solsman, Dow Jones Newswires; 212-416-2291; joan.solsman@dowjones.com