American trucking company Yellow Corporation shut down its operations Sunday, just short of its 100th anniversary. It comes after the company conducted layoffs and stopped taking in new shipments. Yahoo Finance Reporter Dani Romero discusses Yellow's potential bankruptcy filing and the impact it would have on its employees.
JULIE HYMAN: It is the end of the road for thousands of trucking employees as Yellow Freight shuts down all of its operations that happened yesterday. The business was just short of its 100-year anniversary. It was once one of the biggest players in the industry. The often troubled freight operator received a $700 million loan from the federal government during the COVID-19 pandemic. For more on the story, Yahoo Finance's Dani Romero joins us. So Dani, how should we think about Yellow in terms of how things are trucked around this country?
DANI ROMERO: Julie, it's been a rough few weeks for workers at Yellow Freight. First, they were fearing that they might lose their health care benefits. And now, a bankruptcy is looming. I've checked multiple websites to see if the company has publicly filed, and they haven't just yet. But the timeline here starts on Friday.
The company had laid off most of its non-union employees. And the company also stopped taking in new shipments last week. They just delivered what they currently had within their network. And then on Sunday, they announced all operations were shut down at noon.
In a separate notice, the company plans to issue a public statement today, on Monday, updating the state of the company and the operation. And the company has had multiple bailouts, I mean, including a COVID-19 loan given in 2020. The US Treasury now holds about 30% of Yellow shares, which if you check right now, those shares are about like $1 or so. So there's a lot at stake here. If Yellow collapses, more than 30,000 people, including 22,000 teamsters will be left without a job, Julie.
BRAD SMITH: And Dani, while we have you, there's an impact to the taxpayer here as well. What are the details there from what you have uncovered?
DANI ROMERO: This is not just bad news for employees, but also for the customers. This was also a way that people could send their shipments, goods. It was a cheap way to send goods. But on the taxpayer side specifically, the company received $700 million in a loan from the government and which resulted in taxpayers holding 30% of its outstanding stock.
And the company has not paid that back to the Treasury Department. And the company's balance sheet includes $1.5 billion in debt. What happened here? That is the million-dollar question. It's also a wait and see because the company hasn't publicly made a statement or filed for bankruptcy yet.