YRC Worldwide's Shares Plunge As Union Rejects Contract Extension Offer

(RTTNews) - YRC Worldwide Inc.'s (YRCW) shares plunged around 16 percent on regular trading and around 20 percent on extended trading on Thursday after the trucking company's union employees voted against extending their contract.

The International Brotherhood of Teamsters announced earlier Thursday that the employees did not approve the Memorandum of Understanding or MOU extension proposal made by YRC Worldwide.

In a statement, the company said its officials are in contact with Teamster leaders to explore options.

The contract extension would have extended Teamsters' agreement with YRC for five years till March 31, 2019.

The company earlier had noted that the proposed contract extension would allow the firm to gain additional operating flexibilities in areas such as the increased use of purchased transportation and utility employees, among others, and allows the firm to move forward with its effort to refinance the balance sheet.

YRC Worldwide CEO James Welch now said, "While we are disappointed in the outcome of the vote, we believe that timing of events related to our refinancing did not work in our favor. Many employees had already returned their ballots prior to December 23, the date the company announced it had a refinancing agreement in place. We believe that was information employees needed to make a fully informed decision."

The company stated that its business is as usual despite the vote results, as it has approximately 15,000 trucks on the road serving 250,000 customers.

YRC Worldwide shares closed Thursday's trading at $15.67, down $2.99 or 16.02 percent. In the after hours trading, shares plunged $3.07 or 19.59 percent further to $12.60.