Top 2 officials of Preston Trucking resign as troubled firm is acquired

February 20, 1993|By Suzanne Wooton | Suzanne Wooton,Staff Writer

The top executives of Preston Trucking Corp. resigned yesterday as Yellow Freight System Inc. completed the final steps in acquiring the troubled Eastern Shore trucking company.

William Potter, former chairman of Preston Corp., and William Tarrell, former president of the company's trucking unit, Preston Trucking Co., resigned after the tender offer to acquire Preston Corp. was completed.

Yellow said yesterday that its chairman, George Powell III, had been elected chairman of Preston Corp. and that Leo Suggs, a former senior vice president of corporate development for Yellow, will serve as president of Preston Corp. and Preston Trucking.

Yellow said that an all-cash tender offer of $4.125 a share for Preston's approximately 5.8 million shares outstanding ended yesterday and that a preliminary count indicated that 5.3 million shares had been tendered, exceeding the two-thirds requirement to complete the deal.

The transaction has also received approval from the Interstate Commerce Commission.

Company officials said Preston's three subsidiaries -- Preston Trucking Co., Saia Motor Freight Line and Smalley Transportation Co. -- would still operate separately.

It remained unclear whether the acquisition would mean layoffs for Preston Trucking, which had lost money steadily during the past three years, or whether its headquarters would be moved from Preston, a small town in Caroline County.

"A turnaround plan for Preston Trucking Co. will be announced to employees and customers within the next few weeks," Mr. Suggs said in a statement.

Preston has more than 5,700 workers, including about 1,000 in Maryland.

Preston, one of Maryland's largest and oldest publicly traded companies, agreed to be bought by the giant Yellow in November.

Preston officials said they were unable to overcome pressures created by industry deregulation in the early 1980s and the recession that hit in the 1990s.

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