Teamsters Criticize YRC’s Offer to Buy ABF
The Teamsters union strongly criticized YRC Worldwide’s bid to buy ABF Freight System, calling such a potential merger “unconscionable.”
Arkansas Best disclosed Thursday that YRC had approached it about buying ABF — its less-than-truckload unit that competes with YRC — but that it had rejected YRC’s overture.
YRC CEO James Welch, who has been in his position since July 2011, said the main reason for the initiative was to increase freight density, leading to improved profits.
“It’s a way to attack a challenge we both share,” he told Transport Topics, adding that the two companies’ network locations are nearly identical, with the potential to add about 17,500 daily ABF shipments to the current 45,000 handled by YRC Freight.
YRC’s Teamsters-represented employees are working under the terms of a 15% pay cut, which was granted in exchange for stock ownership in the company.
Teamsters General President James Hoffa said that because his union’s members have already made those concessions to YRC — and are currently considering a new five-year pact with ABF parent Arkansas Best Corp. — such a merger would amount to “interference in the collective bargaining process.”
ABF and the Teamsters agreed last week to the terms of a new five-year labor contract, but that pact still must to be ratified by the union’s rank-and-file members.
YRC and Arkansas Best are both publicly traded companies. YRC’s stock rose about 3.8% Friday to about $14.60 a share, while Arkansas Best’s slipped less than 1% to about $16.60 after jumping 9% on Thursday.
