Is YRC Worldwide About To Go Bankrupt? (YRCW)

Reuters is reporting that there is a distinct possibility that YRC Worldwide YRCW could go bankrupt following the company's failure to reach an agreement on restructuring.

On Wednesday, shares of the trucking company fell 28 percent after it revealed that, after failing to get the necessary approvals for its proposed financial restructuring (which would have swapped some of its debt into stock), there is a danger that its lenders could declare the company in default and push it into bankruptcy.

YRC has been struggling with debts of over $1 billion for over a year, in addition to high labor costs and the sluggish economic recovery, and this week it hit its lowest share price in more than ten years when it closed at $1.47 on Wednesday.

The news that it failed to reach agreement seems to be another nail in the company's coffin. “As a result, the required lenders have the right, but not the obligation, to declare an event of default,” YRC said in its annual report, before adding that, should the lenders declare default, the company would anticipate filing for bankruptcy.