Coach America gets court OK for $5 million sale of three major assets

By Jim Witters

Wilmington, Del., May 15 - Coach America Holdings Inc. received court approval Tuesday for the $5 million sale of three major assets, including an agreement to operate part of the city of Los Angeles' bus system.

In an auction and negotiation process that began April 25 and continued until minutes before a hearing in the U.S. Bankruptcy Court for the District of Delaware, Coach America reached terms for:

• The $3 million sale of CUSA ES, LLC and CUSA CSS, LLC - the crew transportation services business - to Professional Transportation Inc. The purchaser also agreed to assume "certain liabilities" as part of the deal;

• The $1.5 million sale of CUSA EE, LLC to the Tornado Bus Co.; and

• The $500,000 million sale of an agreement for the operation of the city of Los Angeles' Department of Transportation's bus transit operation services for the north region of the combined services to MV Transportation, Inc.

Objections left open

Judge Kevin Gross approved the sales despite several outstanding objections from parties seeking to protect their rights.

Since the deal with Professional Transportation was not concluded until just before the hearing, many attorneys present had neither reviewed the asset purchase agreement nor conferred with their clients.

An attorney representing Bridgestone Americas Tire Operations, LLC said that $230,000 worth of tires on the Coach America buses being sold in two of the transactions "belong to Bridgestone and cannot be sold."

And representatives of the National Railroad Passenger Corp. (Amtrak) and of the BNSF Railway raised questions about the continuing of insurance coverage through the sale process and closing of the transactions.

Those issues were left unresolved at the close of the hearing.

Sales approved

Gross ruled that the sales comply with the sale procedures approved by the court and appear to be in the best interest of the debtors estates, and he said he believed the parties could work through the remaining issues quickly.

He instructed the attorneys to work out the remaining objections and submit under certification of counsel a final order approving the three sales.

Debtors attorney Jason Teele said he hoped to complete the discussions and submit the final order within 48 hours.

Teele also said the motorcoach segment of the business does not have a buyer. But the auction for the remaining assets was scheduled to resume at 6 p.m. ET on May 15.

Coach America, a Dallas-based tour and charter bus operator and motorcoach services provider, filed for bankruptcy on Jan. 3. The Chapter 11 case number is 12-10010.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.