Solutia seeks approval of bid procedures for $67 million Dequest business sale

By Caroline Salls

Pittsburgh, March 20 - Solutia Inc. requested court approval of the bidding procedures for the proposed $67 million sale of its Dequest water treatment phosphonates business, according to a Monday filing with the U.S. Bankruptcy Court for the Southern District of New York.

Thermphos Trading GmbH is the stalking horse bidder.

The minimum overbid must include Thermphos' purchase price, plus a 3% minimum overbid increment, a 3% break-up fee and $1 million for expense reimbursement.

Subsequent bids at auction must be for at least $500,000 more than the previous bid.

Each bid must include a 10% deposit.

The auction will be held May 2, and the sale hearing is scheduled for May 4.

As previously reported, Thermphos will also assume some of the liabilities of the Dequest business.

In addition, the parties will enter into a lease and operating agreement, under which Solutia will continue to operate the Dequest facility to produce Dequest products exclusively for Thermphos at Solutia's plant in Newport, Wales.

A hearing on approval of the bid procedures is scheduled for April 11.

Solutia, a St. Louis-based manufacturer and provider of performance films, specialty chemicals and an integrated family of nylon products, filed for bankruptcy on Dec. 17, 2003. Its Chapter 11 case number is 03-17949.

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