Why did all these creditors extend additional credit to YRCW?
Here is what I don't understand! In October 2010, the ABS creditors all agreed to continue to allow an ABS loan capability to YRCW for $325 Million of which $194 million has not even been drawn against and the extension is until October 2011! Second in August 2010 a $70 million bond was negotiated with investors to allow the company to refinance 2 seperate bond tranches which is due in 2014! Third the MEP agrees to extensions to their monies until June 2011! Now the market cap of the company is currently $167 million! Fourth, they have an established Letter of Credit for $550 million from a Large Bank which has NOT been withdrawn from that institution! I would of thought with all these financiers research departments and credit departments and fancy suit executives someone would of pulled their credit with YRCW or not support the financing! These are all big money players, not local banks!
MY QUESTION IS, WHAT THE H E L L DID ALL THESE BIG TIME FINANCIERS SEE IN THIS COMPANIES TURNAROUND PLAN THAT A FEW INDIVIDUALS SITTING ON AN OFFICE CHAIR DRINKING BEER DID NOT SEE!
ggp, we've been over this many times. You clearly have never been involved in a workout situation. This is EXACTLY what happens when a company is on the verge of bankruptcy and desperately needs a recap to stay alive. Lenders will do ANYTHING possible to preserve their priority, protect their interest, and position themselves. Yes, this means granting extensions, this means allowing loans... all strategy, period!
Seriously, what don't you get about this? You make it sound as if all of these lenders are just oh so happy to lend lend lend to yrc and that they "see something we don't" - seems like the only person on this board that doesn't see what's going on is YOU!
I bought after the $70 million debt offering went through, I was actually looking at this for a client to determine if they should be worried about their AR with YRCW. I told them they looked good and started buying stock
That logic sucked for me. Those lenders may want the company for all we know, but that is not good for us if they take it away from us or take away 75% of it