YRC Worldwide Is out of Its Mind

When YRC Worldwide  (NASDAQ: YRCW  )  revealed its plan to buy rival Arkansas Best Corporation (NASDAQ: ARCB  ) earlier this month, a lot of people wondered if the company was crazy -- trying to buy a rival three times its own market cap, and it, YRC, in hock to the tune of $1.2 billion (net of cash) to boot!

The craziest revelation, though, is that Arkansas Best may not be 100% dead-set against the idea, despite YRC's record of losing money, piling on debt, and nearly going bankrupt two years ago. As contributor Rich Smith explains, even if Arkansas Best is looking to do a deal with someone, it has much better options than hitching its wagon to YRC.

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  • Report this Comment On May 20, 2013, at 7:33 PM, spwangsu wrote:

    The comment on the stocks of ABFS and YRCW seems are based on their operations two years back, not current. Actually, ABFS has negative operation gain. It is way too small to compete in the industry (to YRCW or CNW). YRCW has actually operation positive cash flow except its interest payment burden. Its yoy operation improvement has made the ground for it to rise from the ashes. ABFS and YRCW merger sounds like a good one to combine the better balance sheet (ABFS) and operation cash flow( YRCW), which will improve its borrowing ability (lower interest rate) and gaining competition advantages. Overall it makes a lot sense.

  • Report this Comment On March 27, 2015, at 3:35 PM, youstink wrote:

    It makes slight 'sense', only if you are upside down, to the tune of 1.2B. Otherwise, this is a dead cat bounce.

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