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March 15, 2019 – The Court hearing the Aceto Corporation cases issued an order [Docket No. 142] approving (i) the Debtors’ proposed bidding procedures in respect of a section 363 asset sale, (ii) bid protections for the stalking horse bidder NMC Atlas (the “Buyer” or “Stalking Horse Bidder”) and (iii) an auction schedule. The Debtors have entered into an staking horse agreement with the Buyer pursuant to which the Buyer has proposed to purchase the Debtors’ Chemical Plus Business for an aggregate purchase price for $338mn.
Key Terms of the Stalking Horse Agreement:
- Sellers: Aceto Corporation, Aceto Agricultural Chemicals Corporation and Aceto Realty LLC.
- Purchase Price: The aggregate consideration for the Purchased Assets (the “Base Purchase Price”) shall be the sum of the following:
- Cash of $338mn (including a cash deposit of $33.8mn),
- Plus the amount, if any, by which Net Current Assets exceeds $126,181,807,
- Minus the amount, if any, by which Net Current Assets are less than $126,181,807,
- Minus Net Debt (such amount, as adjusted pursuant to Section 2.4 below, the “Cash Balance”),
- Plus the Cure Costs,
- Plus the assumption by Buyer of the Assumed Liabilities.
Key Terms of the Proposed Bidding Procedures:
- Bid Protections: The Stalking Horse Agreement provides that if the Stalking Horse Bidder is not the successful bidder, then the Debtors will pay the Stalking Horse Bidder a break-up fee of $6.76mn (2% of the cash component of the Base Purchase Price, the “Break-Up Fee”) and reimburse expenses in cash of up to $2mn (the “Expense Reimbursement”).
- Qualified Bids: Qualified bids, if for the Purchased Assets, must exceed the aggregate cash consideration set forth in the Stalking Horse Agreement by at least $9.76mn, which is comprised of the (i) Break-Up Fee plus (ii) the maximum amount of the Expense Reimbursement plus (iii) an overbid of $1.0mn.
- Sale Objection Deadline: April 5, 2019
- Sale Objection Deadline (For Committee): April 14, 2019
- Bid Deadline: April 8, 2019
- Deadline to Notify Qualified Bidders: April 9, 2019
- Deadline to Select Starting Bid: April 10, 2019
- Auction: April 12, 2019
- Sale Hearing: April 16, 2019
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