Bankrupt Trucking Company Yellow Agrees To Sell Its Real Estate To Rival For $1.3B

Estes Express Lines has agreed to acquire the real estate of bankrupt trucking company Yellow for at least $1.3B. The portfolio includes more than 160 truck terminals, a kind of property that is rarely traded, according to The Wall Street Journal.

Since Yellow is currently in Chapter 11 bankruptcy, which will result in its ultimate liquidation in an effort to pay off its roughly $2.5B in debt, the sale to rival trucking line Estes will be subject to the court's approval. It could be superseded by a better offer.

“You are going to have a tremendous amount of interest in this portfolio,”  Wofford Advisors partner Chris Wofford told the WSJ.

Virginia-based Estes currently owns about 155 U.S. industrial and office properties.

The last time there was a truck terminal sale of this magnitude was in 2002, after the bankruptcy of Consolidated Freightways, CoStar reports.

Yellow will also sell its roughly 12,000 trucks. The company was the fifth-largest transporter of goods in the United States — and at one time, the largest — but went bankrupt in July after refinancing its debt proved impossible.

A large part of the debt was due to a $700M federal government loan that the company took early in the pandemic period, CBS reports. At the time of its closing, Yellow had about 10% of market share in the long-distance trucking business.

Walmart and Home Depot, which were among Yellow's larger clients, halted shipments ahead of the bankruptcy to prevent goods from being lost or abandoned, Reuters reports.

Management blamed the Teamsters union for the company's demise, while the Teamsters blamed management.

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Related Topics: Estes Express Lines , Trucks , Yellow
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