Celadon Group, Inc. – Seeks Expedited Sale of North Carolina Hauler Taylor Express as a Going Concern with Auction Proposed for January 15th

Register, or to view the article

December 10, 2019 – The Debtors filed a motion requesting each of a bidding procedures order and a sales order [Docket No. 48]. The bidding procedures order would approve bidding procedures in relation to the sale of the Debtors’ Taylor Express assets (the “Sale”), including bidder protections and a proposed auction/sale schedule; and the sale order would authorize the Sale. According to the Debtors, who bought the North Carolina-based company for $49.0mn in 2015, "Taylor Express provides expert bulk transportation services, focused on high-quality, best-in-class customer service in the South and Southeast regions." Taylor Express describes itself as "a leading carrier in the tire and rubber industry, providing dedicated services on critical raw materials for the tire industry and many other well known companies like Kohler, Lowes Hardware and Purolator…"

The motion states, “Unfortunately, the majority of the Debtors’ assets will shortly be liquidated, owing to a combination of industry headwinds, an overleveraged debt structure and the legacy impact of an extensive governmental investigation of the Debtors’ prior management. One of the Debtors’ business operations, Taylor Express, likely has substantial value as a going concern. Accordingly, through this Motion, the Debtors seek authority to quickly commence and implement a process to sell substantially all of the assets of Taylor Express as a continuing and ongoing business (the “Taylor Assets”).”

The motion continues, “Prior to the commencement of these Cases, the Taylor Assets were extensively marketed to potentially interested third parties, including business discussions, including telephone calls, in-person meetings between and among senior management, the parties’ legal teams, and the parties’ various advisors, which marketing efforts are still ongoing.

Based on the extensive diligence, the Debtors, in consultation with their advisors, have determined that filing the Asset Purchase Agreement, which will allow potential bidders to mark-up the Asset Purchase Agreement and submit proposals, and the continued marketing of the Taylor Assets, is the best and most efficient way to maximize the value of the Taylor Assets for the Debtors, their estates, creditors of their estates, and all parties in interest. This expedited process is required due to the Debtors’ overall liquidity constraints and the difficulty of maintaining Taylor Express as a going concern in the midst of the liquidation of the balance of the Debtors’ assets.

The Debtors seek authority to proceed with a bidding and auction process, in order to market-test Asset Purchase Agreements proposed by potential bidders, and sell, pursuant to and in accordance with the Bidding Procedures, the Taylor Assets to the bidder submitting the highest or otherwise best bid for the subject assets free and clear of claims, liens encumbrances and interests of others.”

Bid Protection – The Debtors have requested bid protections in the form of (i) a breakup fee in the amount of 3% of the purchase price; (ii) expense reimbursement in an amount up to 1.5% of the purchase price and (iii) an initial overbid requirement of $100,000 higher than the sum of the (i) purchase price, (ii) break-up fee and (iii) expense reimbursement.

Proposed Key Dates:

  • Bid Deadline: January 13, 2020
  • Auction (If necessary): January 15, 2020
  • Sale Objection Deadline: January 17, 2020
  • Sale Hearing: January 21, 2020

Read more Bankruptcy News