Attny: P'tex auction could be crowded
GDA Staff -- Gifts & Dec, August 29, 2003
New York — With the timetable extended for the Pillowtex auction and bid qualifications eased by the bankruptcy court yesterday, the attorney for Pillowtex's unsecured creditors committee believes there may be a very active auction of the company's assets during an Oct. 2 liquidation.
"We've had dozens of calls expressing interest" in various Pillowtex assets, Mark Power, a partner with Hahn & Hessen, New York, told HTT today. "A number of very credible parties have expressed their interest, and we're hopeful it will be a lively auction."
Power indicated there was a "wide range" of companies interested in joining the bidding, perhaps including liquidators, foreign and domestic textiles companies, and equipment companies. He declined to identify any by name.
The court has now set Sept. 29 as a bid deadline, Oct. 2 for an auction and Oct. 7 for a court hearing to ratify the result, either to another successful bidder or to initial bidder GGST under its sale proposal.
The four-company joint venture, formed specifically for the Pillowtex liquidation, had made a bid of $56 million, but that value increased to more than $88 with the addition of $17.7 million in liabilities and $14.4 million in carrying costs.
Pillowtex president and cfo Michael Harmon said he was hopeful there would be active bidding but said it was unlikely unsecured creditors would receive any payout if the GGST proposal weren't outbid.
"Our No. 1 objective is to find people to overbid," Harmon said. "We know there are a lot of people interested."
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