January 17, 2014 / 11:36 PM / 4 years ago

UPDATE 1-YRC Worldwide reaches tentative deal with Teamsters union

2 Min Read

Jan 17 (Reuters) - Trucking company YRC Worldwide Inc and the Teamsters union reached a tentative deal for a new labor contract that sets the stage for the struggling company to push ahead with a refinancing plan.

YRC shares rose 22 percent in extended trading.

The revised proposal would be reviewed at a meeting of local union officials on Jan. 21 and would have to be ratified by union members, the International Brotherhood of Teamsters said in a statement.

The 26,000 YRC members represented by the union had last week voted down a proposal by the company to extend their labor contract.

That vote put in jeopardy efforts to refinance the company's debt, more than $1 billion of which will start coming due in February.

YRC said on Friday that the tentative agreement, which comes a day after the company restarted talks with the Teamsters, addresses concerns raised by the union and contains a number of revisions to the earlier proposal.

"The outcome of this week's discussions is critical to the future of the company, YRC Chief Executive James Welch said in a statement.

Welch said the deal to extend a collective bargaining agreement to March 2019 was "the best - and only remaining - path forward."

Shares of the company were trading at $18.94 after the bell. They closed at $15.82 on Friday on the Nasdaq.

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