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LG. Philips seeks court OK to abandon $500,000 in Mexican facility inventory
By Caroline Salls
Pittsburgh, July 13 - LG. Philips Displays USA, Inc. requested court approval to abandon $500,000 worth of inventory and related equipment at its Mexican production facility, according to a Thursday filing with the U.S. Bankruptcy Court for the District of Delaware.
According to the motion, the Mexican assets include robotic equipment, measuring equipment, and spare parts that may have value to a manufacturer of cathode ray tubes.
If the assets were to be sold "where is," the sale value would be in the range of $500,000.
However, the company said if the Mexican assets were to be removed from the facility for liquidation in Mexico separate from a sale of the entire facility, the cost of removing the assets would exceed $500,000, and perhaps cost millions of dollars.
The cost of removing the assets from the facility for liquidation in the United States would be more than $3 million.
The company said has not received any offers to buy the assets directly from the facility.
In addition, LG. Philips said selling the assets through a bankruptcy sale would have tax implications for the Chapter 7 estate, as the Chapter 7 trustee would be required to retain a tax professional familiar with international issues to analyze any sale issues, and other professional fees would also be incurred.
"Thus, the most realistic liquidation value should factor in the costs of removal of the Mexican assets from the Mexico facility," the motion said.
"These costs meet or exceed the likely gross liquidation value of the Mexican assets themselves."
A hearing is scheduled for Aug. 1.
LG. Philips Displays USA, a San Diego-based producer of TV and computer monitor tubes, filed for bankruptcy on March 15. Its Chapter 7 case number is 06-10245.
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