“I don’t know that I can tell you that I am” optimistic, Nash told Goldblatt. “But I’m not pessimistic either.” (Charlie Riedel/Associated Press)
Creditors of defunct trucking firm Yellow Corp. will submit their own plan in coming days on how to split up the company’s remaining $550 million of cash and end its bankruptcy case.
Two of the firm’s biggest pension plans have reached a deal with a creditors committee in efforts to end a long-running court battle with Yellow and its hedge-fund owners, lawyers told the judge overseeing the insolvency case on March 17. That fight has generated tens of millions of dollars in legal fees, according to court records.
No plan has so far garnered sufficient creditor support to proceed. Yellow’s latest payout proposal doesn’t have enough votes to do so, Patrick Nash, the company’s lead lawyer, said during the hearing.
Yellow’s official committee of unsecured creditors, which represents pension funds and other creditors, plans to file its latest proposal with the bankruptcy court in Wilmington, Del., by the end of this week, said Meredith Lahaie, who is a lawyer for the committee.
The company’s bankruptcy advisers received the proposal on March 14 and are still evaluating it, according to Nash. No details have been made public and the proposal has not yet been shared with the company’s biggest shareholders, including MFN Partners.
“I don’t know that I can tell you that I am” optimistic, Nash told U.S. Bankruptcy Judge Craig Goldblatt. “But I’m not pessimistic either.”
RELATED: Court Nixes Teamsters’ WARN Claims Against Yellow
Nash said Yellow will try to make a compromise work. “Any plan we move forward with that isn’t supported by MFN and (others) is going to be hotly contested and it’s going to be heavily litigated,” he added.
Some pensions that didn’t help negotiate the new proposal fear they will be forced to accept a deal that does not benefit them, Andrew Leblanc, who represents a New York Teamsters pension fund, said during the hearing.
After Yellow filed for bankruptcy and shut down, funds tried to make the trucker pay billions of dollars in penalties for quitting the retirement plans. MFN and the company have spent months in bankruptcy court fighting over the size of any penalties.
Yellow sold its most valuable properties while under court supervision and is in the process of finding buyers for its remaining assets, Nash said during the March 17 hearing. The company has about $550 million in cash that is earning 4% interest annually, he added.
The case is Yellow Corp., 23-11069, U.S. Bankruptcy Court, District of Delaware (Wilmington).
