Bankruptcy court delays P'tex decisions
Furniture Today Staff -- Furniture Today, August 21, 2003
Wilmington, DE — A federal bankruptcy court judge has put off at least until next Thursday a series of decisions on how Pillowtex's assets will be sold off.
U.S. District Judge Peter Walsh considered a series of motions during a hearing yesterday to approve the procedures for bidding, the auction and the contingency sale to GGST LLC — along with multiple objections. Several challenges were filed to the unusually quick timing of the bidding and auction process.
Pillowtex's current proposal and agreement with GGST — still subject to court approval — calls for competitive, qualified and irrevocable bids to be filed by Sept. 4 with an auction, if any, slated for Sept. 10.
Some parties to the procedure complained in court papers that the terms and timing of the bidding process seem to discourage bidding and give GGST an inside advantage. Welspun India Ltd. and others complained that the proposed timetable would prevent it from conducting adequate due diligence to come up with a bid for specific assets.
The Committee of Unsecured Creditors also challenged the structure of the sale, which provides mainly for large chunks of the company to be sold off together. The committee produced an affidavit from a consultant suggesting bidders be allowed to go after any portion of the business they choose in order to maximize value.
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