YRC trucking makes headway on needed debt deal

OVERLAND PARK, Kan. Dec 21 (Reuters) - U.S. trucking giant YRC Worldwide (YRCW.O) said on Monday that it had received the needed approvals from lenders and pension funds to allow it to proceed with a critical debt-for-equity exchange offer that could keep the company out of bankruptcy.

YRC, the largest U.S. trucking company in the "less than truckload" category, has been trying to get a majority of its bondholders to agree to swap about $536.8 million in debt for equity.

Last week after failing to get sufficient bondholder approval the company lowered the threshold, a move subject to approval by lenders.

YRC said Monday that lenders had approved the needed amendments and the U.S. Securities and Exchange Commission had declared the company's registration statement effective. In addition, the revisions to the minimum tender conditions have also been consented to by the required multi-employer pension funds involved in a contribution deferral agreement, YRC said.

YRC said last week it must convince bondholders to swap debt for equity by Dec. 31 in order to avoid a $19 million payment of interest and fees that the company said it cannot make if the swap fails.

YRC initially said it thought it could obtain approval from 95 percent of bondholders for the proposed $536.8 million bond exchange. It said it would issue 42 million shares of common stock and 5 million shares of Class A convertible preferred stock in the exchange, which would give noteholders 95 percent of the company's common stock and effectively wipe out existing equity holders.

However, after failing to get the needed participation, the company said on Thursday it was lowering the threshold for bondholder approval and was extending the expiration date for the third time, to 11:59 p.m. EST Dec. 23, to try to get the needed participation.

The company has said the debt-for-equity swap is crucial to its restructuring.

(Reporting by Carey Gillam; Editing by Richard Chang)