The Trump administration just lent $700 million to a trucking company sued for ripping off taxpayers

[Yo_Mama_Been_Loggin]

New York (CNN Business)The US Treasury is giving a $700 million loan to YRC Worldwide, a troubled trucking company that warned in May it was in danger of going out of business.

That's an enormous sum for a company whose stock had plunged 27% this year and was worth only $70 million as of Tuesday's close. And here's the kicker: The government sued YRC for ripping it off.

Long-term competitive problems had taken the company's stock down 85% over the last five years. But shares of YRC (YRCW) shot up 60% in early trading on the news of the bailout.

US taxpayers will end up owning 30% of the company's stock as part of the loan agreement.

The loan is not part of the federal CARES Act meant to help small businesses. Instead, it is meant to provide help to businesses critical to national security. Treasury's statement said the loan was justified by the fact that the company provides a majority of the trucking services moving pallet-sized shipments of freight for the US military, a segment of the industry known as "less-than-truckload" or LTL.

https://www.cnn.com/2020/07/01/business/yrc-federal-loan/index.html

[rzemanfl]

1. For that kind of dough I would put the pallet on a jack and walk the thing to

where they wanted it.

[mwooldri]

2. Mixed thoughts from me on this.

There aren't many truck lines that have union recognition. YRC is the biggest of the unionized truck lines. So keeping them supported IMO is a good thing. However if management of YRC has been screwing over the government as the article states, then YRC should go under and the company be reorganized. However doing that will mean the replacement company or companies would be non-union. That would mean lower wages and poorer benefits for drivers.

[demosincebirth]

6. I worked forty years for YFS. It was a great company.

Their big mistake was buying Roadway.

[stuffmatters]

3. Sure hope someone checks records for Trump et alios insider trading on this one.

[Faux pas]

4. Kickin' with disgust!

[dixiechiken1]

5. $700M "loan" to a company worth $70M???

YRC has been seriously mismanaged for years. Their financial woes are NOT strictly pandemic-related; rather, they predate COVID by a long stretch. A very long stretch. At best, this is a very expensive bandaid that will do little to stop the long-term hemorrhaging.

We own 30% of a company that most likely will no longer exist by 2024, when this loan comes due. 30% of nothing is... NOTHING.

Something stinks here, BIGLY. I hope some journalist does their due diligence and follows the money.

Free market, my ass.