A couple of years back negotiations were in the latter stages for the sale of FDX Freight to Old Dominion but the process suddenly ended. The suspicion was that federal antitrust regulators were watching the deal. OD decided to stay cool and wait to see what fell in it's lap later.
Into it's lap falls Yellow.
In an interview the head of OD was asked if he was interested in Yellow. He said he was very much interested in Yellow's real estate but not it's trucks and trailers. No surprise. Real estate goes up in value,. Trucks go down in value. That's why FDX Ground has contractors to eat those losses.
At the time of shutdown Yellow was reportedly 1.5 billion dollars in debt of which 700 million was owed to the federal government. So come this past Friday night low and behold OD shows up with an offer of guess what? 1.5 billion which beat Estes offer of 1.3 billion but the 1.5 offer was only for the real estate.
Will OD end up with Yellow or will somebody like Fat Freddy will decide that he doesn't want to be left out of the fun? From a competitive balance standpoint buying up and integrating Yellow's assets and facilities into the new owner's operation might be easier given that it's a bankruptcy transaction.
Into it's lap falls Yellow.
In an interview the head of OD was asked if he was interested in Yellow. He said he was very much interested in Yellow's real estate but not it's trucks and trailers. No surprise. Real estate goes up in value,. Trucks go down in value. That's why FDX Ground has contractors to eat those losses.
At the time of shutdown Yellow was reportedly 1.5 billion dollars in debt of which 700 million was owed to the federal government. So come this past Friday night low and behold OD shows up with an offer of guess what? 1.5 billion which beat Estes offer of 1.3 billion but the 1.5 offer was only for the real estate.
Will OD end up with Yellow or will somebody like Fat Freddy will decide that he doesn't want to be left out of the fun? From a competitive balance standpoint buying up and integrating Yellow's assets and facilities into the new owner's operation might be easier given that it's a bankruptcy transaction.
