Orion Healthcorp’s Chief Executive Officer and TG Capital filed with the U.S. Bankruptcy Court a notice of competing bid and objection to Debtor’s motion approving bidding procedures relating to the sale of certain of the Debtors’ assets; approving bid protections; approving the form and manner of notice of sale by auction; establishing procedures for noticing and determining cure amounts; scheduling a hearing on the proposed sale; and approving asset purchase agreement and authorizing the sale of assets free and clear of all liens, claims, encumbrances, and interests.
The objection asserts, “The Debtors’ Motion contains only conclusory statements about the substance of the asset purchase agreement presented to this Court and little discussion about the sale process. Specifically, the Motion fails to disclose what contracts will be assumed or how many employees of the Debtors will be hired by the proposed purchaser. In addition, in its perfunctory recitation, the Motion fails to disclose certain troublesome facts about the sale process including: (i) that the Debtors threatened to shut down the Orion RCM Business immediately upon the commencement of the chapter 11 cases until the Objectors indicated that they would make a separate bid to purchase the Orion RCM Business; (ii) that the Debtors did not solicit uniform bids on the assets that they intended to sell and therefore, did not obtain the highest proposal to serve as the stalking horse; (iii) that the Debtors led at least the Objectors to believe that they would file chapter 11 cases for the NYNM-related assets which they never did file; and (iv) that the Debtors failed to disclose the existence of the executed letter of intent while inducing the Objectors to continue to expend resources with no apparent intention of continuing negotiations in good faith.
Without providing any of that information to the Court or an affidavit describing the process in any detail, the Debtors nevertheless conclude that the offer set forth in the Motion is both the ‘highest and best’ proposal received….Indeed, it appears from the Motion that the Debtors misled the Objectors regarding bidding process and the selection of the stalking horse. While the Motion indicates that on April 10, 2018, the Debtors received a letter of intent from the proposed purchaser for the Debtors’ assets, the Motion fails to note that the Debtors never advised the Objectors that the Debtors had decided to sell only the Debtors’ assets, and not the assets of the NYNM business as well. In fact, they failed to share this information even while the Objectors, their representatives, and the Debtors’ representatives all participated in an in-person meeting at the offices of Debtors’ counsel as late as April 25, 2018. Moreover, as a result of that meeting, the Debtors’ representatives induced the Objectors to prepare a further draft of an asset purchase agreement that included the NYNM assets that the Debtors apparently had no intention to sell. Had the Debtors’ representatives merely indicated that they would only sell the Debtors’ assets, the Objectors could have submitted this bid earlier and generated a higher and better offer for the benefit of the Debtors’ estate that the Objectors have submitted now.”
Read more bankruptcy news
The post Orion Healthcorp Objection and Competing Bid Filed appeared first on Daily Bankrupt Company Updates | Bankrupt Company News.