Marsh Supermarkets Approved for Rapid Sale
INDIANAPOLIS, IN – As the retailer searches for a buyer for the core stores of its chain, another step has been gained for Marsh Supermarkets. Marsh has been approved for a rapid bankruptcy sale plan by Delaware courts after agreeing to extend its deadline to identify a stalking horse bidder.
"We felt that a little more time would be helpful," said Marsh’s representation, Attorney Robert F. Poppiti Jr of Young Conaway Stargatt & Taylor LLP. "The order allows for the protections to be there, but they are dependent on a further order of the court...we may have a bidder who wants to be heard on those protections before the sale hearing."
According to Law360, Marsh Supermarkets will add a week’s extension to the stalking horse designation deadline. The retailer’s attorney advised that any potential baseline bidder may want to have bid protections in place before an auction. For those unfamiliar, a stalking horse bidder is one who is chosen by the bankrupt company from a pool to place an initial bid on its assests, thus setting the bar for the purchase price of the sale.
Marsh listed nearly $70 million in total debt when it filed for Chapter 11 protection on May 11, and is looking for a quick sale of 40 of its best-performing sales in Indiana and Ohio. The company is looking to find a buyer before its June lease payments arrive for these locations, while it liquidates its other 20 remaining stores.
"While I do note that it is certainly a very expedited timeline...I am satisfied the bid procedures are appropriate under the circumstances," U.S. Bankruptcy Judge Brendan L. Shannon stated.
Objections as to whether the company’s initial Memorial Day stalking horse deadline would give other potential suitors enough time to gauge the value of Marsh’s assets–allowing competing offers to maximize the value of the sale–led to the deadline now being pushed back to June 5. The objections were raised by the official committee of unsecured creditors.
"We don't have a [debtor-in-possession loan] here and that kind of puts us in an interesting spot," Committee Attorney Seth Van Aalten of Cooley LLP said. "There is not a lot of cash here and the longer we go, the more we're going to pick up in unbudgeted expenses."
The committee stated that the deadline extension should encourage other bids, and as of this time, does not oppose Marsh’s rapid timeline which calls for an auction on June 12, and a sale hearing on June 14.
The committee also has yet to hear from any prospective bidders that they would need more time to put an offer together.
Read the entirety of the Law360 article here.
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