UPDATE 3-YRC adviser Rothschild in talks with debt holders

* Retained Rothschild as financial adviser months ago

* Rothschild has initiated discussions with lenders

* Shares hit new low of 89 cents (Updates with YRC statement on business plan)

CHICAGO, July 8 (Reuters) - YRC Worldwide Inc (YRCW.O) said on Wednesday that Rothschild Inc has initiated discussions with several significant debt holders as a financial adviser to the the struggling No. 1 U.S. trucking company's restructuring.

Earlier, a source told Reuters Rothschild had been asked to evaluate potential bond exchanges by YRC. Rothschild was retained early this year by the Overland Park, Kansas-based company and had only recently been asked to take a more active role, according to the source.

YRC's stock plunged 28 percent on Wednesday after Reuters reported its retention of Rothschild to a new low at 89 cents. The stock rose to $1.03 in after-hours trading following the company's statement. The stock has lost 85 percent of its value since early April.

A bond exchange could be announced as early as five to six weeks from now, the source said.

The vast majority of YRC's $2.55 billion in debt is in loans, with $392 million in bonds outstanding.

YRC said Rothschild's discussions with "several significant holders of the company's debt securities" were preliminary. It specializes in mergers and acquisitions and restructuring.

The trucking company said on Wednesday it retained financial advisers, including Rothschild, Tenex Capital Management and Alvarez and Marsal several months ago.

YRC has been working with financial advisory firm Tenex for six months on restructuring plans.

According to the source, who was not allowed to discuss the matter on-the-record, all of the plans Tenex has worked out with YRC are focused on restructuring outside bankruptcy court.

The source described Tenex's involvement as "consensual" -- as it has been approved by YRC's creditors -- and the company has advised the trucking firm on cost cutting, negotiations with the Teamsters union on wage concessions and talks with lenders on amendments to its credit facility.

YRC is a less-than-truckload company, which consolidates smaller loads into a single truck.

So far this year YRC has 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 and convinced its Teamster union-represented workers to take a 10 percent pay cut in return for a 15 percent stake in the company.

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

In late June, YRC said it would start talks on a fresh round of concessions from the Teamsters. YRC said on Wednesday that face-to-face discussions with the Teamsters were continuing this week and have remained productive.

Like the rest of the U.S. trucking sector, YRC has been hit by falling freight volumes and weak pricing. (Reporting by Nick Carey; editing by Leslie Gevirtz and Andre Grenon)