Potential Bidding War Brewing for Dlubak
A potential bidding war is brewing in regards to the proposed sale of Dlubak Corp.'s assets following its Chapter 11 bankruptcy in early August. Shortly after filing, Dlubak announced it would pursue a sale to a strategic buyer, naming Grey Mountain Partners, parent company of Consolidated Glass Holdings, as the "stalking horse bidder." Grey Mountain has proposed paying $2 million for Dlubak's non-real estate assets, according to court documents.
GGI, Oran Safety Glass Israel and OSG Inc. USA have filed objections to the sale in United States Bankruptcy Court for the Western District of Pennsylvania. The companies claim, among other objections, that the timeline for the sale is too short and that the bidding procedures favor Grey Mountain. The court has set a deadline of September 3 for submission of competing bids for Dlubak, with the goal of closing the sale by September 6.
"Although GGI has a strong interest in bidding on the ... assets, it is doubtful that it can fully evaluate the [Dlubak] business by the proposed bidding deadline and proposed auction," GGI states in court documents.
Similarly, Oran Safety Glass Israel and OSG Inc. USA filed an objection, August 15. Among the complaints were the "unnecessarily accelerated" timeframe for the impending auction and assertions that the current bidding procedures "unfairly reward" Grey Mountain Partners.
Curbell Plastics also filed an objection to the sale, identifying itself as Dlubak's largest unsecured creditor, with an outstanding balance of $905,000. In court documents, Curbell asserts the hearing on the sale should not be scheduled until the United States Trustee Office can put together a committee of unsecured creditors. Curbell says the current timeframe would have a "chilling effect" on other bidders.
Hearings on the sale and related bidding procedures took place August 16 and August 20, and will be continued August 22. Visit GlassMagazine.com for results as they become available.