YRC Sells and Leases Back Operations
Estes Express announced real estate contracts with YRC Worldwide subsidiaries YRC Inc., USF Reddaway, Inc., and USF Holland Inc., to buy and simultaneously lease back facilities located throughout the US. The total investment could be as much as $122 million.
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Bank waivers it obtained in January permit YRC to use the proceeds (estimated at up to $150 million) for operating purposes. Under the agreement, Estes will acquire an unspecified number of operations for $122 million and lease them back to YRC for an approximate annual rate of $11 million in aggregate.
The initial lease term for each facility is ten years, with two, 10-year renewal options to extend the term of each lease by up to an additional 20 years. YRC Worldwide will have a right of first offer if Estes decides to sell a facility during the first 36 months.
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