Old Dominion Freight Line Inc. has emerged as the lead bidder at $1.5 billion for the real-property assets of the collapsed Yellow Corp., according to a federal bankruptcy filing Friday.

As such, Old Dominion has become the stalking horse for Yellow’s 119 closed terminals. The bid was signed by Marty Freeman, Old Dominion’s president and chief executive.

Yellow filed for federal Bankruptcy Court protection on Aug. 7, confirming plans for a total shutdown of operations that has put nearly 30,000 employees out of work, including at least 893 in North Carolina.

A status hearing has been set for 11:30 a.m. Sept. 15.

The abrupt closing affects an estimated 145 Yellow employees at its 1255 NC 66 South facility in Kernersville. The Kernersville facility had the second-largest jobs impact, trailing a Charlotte location with 518.

A stalking horse is the term used to describe a bidder who sets a minimum price for the assets. Companies hope that other bidders will emerge with higher offers.

In this instance, Old Dominion’s bid is $200 million more than the stalking horse offer submitted by Estes Express Lines on Thursday.

Old Dominion could not be immediately reached for comment on the stalking horse bid.

According to the filing, Old Dominion has agreed to keep the stalking horse bid active for at least 180 days.

If approved by the U.S. Bankruptcy Court in Delaware, it would combine the No. 2 (Old Dominion) and No. 3 (Yellow) less-than-truckload carriers in the U.S., according to Transport Topics’ Top 100.

Yellow listed $1.5 billion in debt when it entered Chapter 11 bankruptcy with expectations of obtaining debtor-in-possession financing.

A large Yellow shareholder, MFN Partners, and hedge fund Citadel Credit Master Fund has agreed to provide a combined $142.5 million loan to Yellow to assist with winding-down operations.

Competitors

A core element of Old Dominion’s growth spurt the past 10 years has been gaining market share and employees from struggling or out-of-business competitors.

Old Dominion, as of June 30, listed having on average 22,438 full-time employees as of June 30. That’s down 2,455, or 9.8%, over the year.

At last count, Old Dominion had 1,318 employees at its Thomasville headquarters, 668 at its Greensboro service center and 107 at the Kernersville service center that became operational Dec. 13.

As Yellow’s financial and labor challenges became more public and more apparent, Old Dominion’s management team was asked about how the company could benefit during its second-quarter earnings conference call on July 28.

Chief financial officer Adam Satterfield told analysts that “we don’t want to make any comments specifically on one carrier or another.”

“We have seen an uptick in business over the past few days, in particular,” he said. “But really, I think that over the past few weeks, we have started to start seeing a little bit better trend, if you will, and it goes back to maybe beyond that. I think we’re at the end of a long, slow cycle.”

When asked about Yellow’s struggles specifically, Satterfield said “I think that there may be direct freight opportunities, but indirect trade opportunities as well that may come out of if there is an industry event.”

“I think that’s still an if. And we don’t know any more than anybody else.

“But we just are staying engaged with our customers, making sure that they understand the capacity that we have.”

Background

The bankruptcy filing comes five days after Yellow, based in Nashville, Tenn., said Aug. 2 it was closing all operations amid media reports of a pending bankruptcy filing.

According to the N.C. Commerce Department, Yellow’s shutdown also affects a second facility in Charlotte with 118 employees, as well as Raleigh (55), Durham (24), Rocky Mount (13), Fayetteville (six) and Jacksonville and Wilmington (three each).

“The list and locations are based on research efforts by our workforce staff at this point and not coming from the company,” Commerce spokesman David Rhoades said.

Yellow said it has gained the assistance of the American Trucking Associations to assist its employees with job searches and applications.

“This initiative intends to streamline job placement, while giving ATA member companies the ability to connect with thousands of skilled freight and operations professionals, mechanics, logisticians and more,” Yellow said.

For information on the initiative, go to https://www.trucking.org/jobseeker.

Yellow has pulled no punches in assigning blame for the company’s collapse on the International Brotherhood of Teamsters.

The company cited as an example that because of the union’s negotiating tactics against Yellow, it “caused grave concern among investors, drove away customers, and put 30,000 jobs at risk.”

“Instead, IBT leaders announced a strike against Yellow’s then-significantly wounded company. Customers fled and business was not recoverable.

“A company has the right to manage its own operations, but as we have experienced, IBT leadership was able to halt our business plan, literally driving our company out of business, despite every effort to work with them.”

The Associated Press reported Yellow gained a $700 million pandemic-era loan from the federal government on national security grounds.

The Teamsters supported the $700 million loan when it was first announced. As of June 30, Yellow had paid $67 million in cash interest on the loan, which is due in 2024, the company said.

“Yellow has historically proven that it could not manage itself despite billions of dollars in worker concessions and hundreds of millions in bailout funding from the federal government,” Teamsters general president Sean O’Brien said in a statement. “This is a sad day for workers and the American freight industry.”