Trucking firm Estes Express Lines has struck a $1.3 billion deal to acquire all of Yellow Corp.’s terminals out of bankruptcy, an offer that’s subject to higher bids should any materialize in the coming weeks.

Yellow lawyer Allyson Smith said Thursday during a court hearing that Estes Express Lines’ offer is in the form of a so-called stalking horse bid. Estes’ bid will set the floor price for Yellow’s portfolio of terminals at a potential Chapter 11 auction if competing offers are made. Yellow will also sell its tractor and trailers.

Yellow also struck an agreement in principle on the terms of a bankruptcy loan with Ken Griffin’s Citadel and hedge fund MFN Partners LP, the company’s largest shareholder. Citadel is offering to extend Yellow $100 million and MFN is offering to provide the company $42.5 million to fund the trucking firm’s liquidation, Smith said. MFN Partners could extend an additional $70 million if Yellow needs additional cash in the future, she said.

The new bankruptcy loan came together in recent days after Citadel acquired roughly $485 million in Yellow Corp. debt previously owned by Apollo Global Management Inc. and other senior lenders. Apollo and other lenders offered to fund the liquidation but the alternative financing provided by Citadel and MFN Partners will be less expensive, Smith said.

The case is Yellow Corp. 23-11069, US Bankruptcy Court District of Delaware (Wilmington).

--With assistance from Steven Church.