YRC and Teamsters in tentative deal; stock doubles

CHICAGO (Reuters) - Struggling No. 1 U.S. trucking company YRC Worldwide Inc (YRCW.O) said on Thursday it has reached a tentative deal with the Teamsters union on a modified labor contract that will help cut costs and preserve operating capital, doubling the value of YRC stock.

"We appreciate the ongoing willingness of the Teamsters leadership to work with the company to identify ways to improve the financial position of YRC Worldwide during this severe economic recession," YRC Chief Operations Officer Mike Smid said in a statement.

The new deal must be approved in a vote by the Overland Park, Kansas-based company's Teamsters-represented workers.

YRC said details of the modified agreement should be available next week.

This is the second cost-cutting deal struck by YRC with the Teamsters. In the first, approved in January, the company's unionized workers agreed to a 10 percent wage cut in return for a 15 percent stake in the company.

YRC is a less-than-truckload company. Less-than-truckload operators consolidate smaller loads into a single truck.

So far this year YRC has also secured seven amendments to its $950 million credit facility from creditors, persuaded the Central States multi-employer pension fund to take property instead of cash for pension payments.

The company has also worked to streamline its national network by shutting facilities and shedding jobs.

Investment bank Rothschild Inc is in discussions with several of the truck firm's significant debt holders as an advisor to YRC.

In morning trade on Nasdaq, YRC shares were up 96 cents or nearly 108 percent at $1.85.