Torch Offshore fleet sale bidding procedures, $1.88 million break-up fee approved

By Caroline Salls

Pittsburgh, May 9 - Torch Offshore, Inc.'s bidding procedures and choice of Cal Dive International, Inc. as the stalking horse bidder for its fleet of vessels were approved in an order filed Friday with the U.S. Bankruptcy Court for the Eastern District of Louisiana.

The break-up fee will be $1.88 million, with expense reimbursement subject to a cap of $500,000.

Torch Offshore agreed to sell its fleet of vessels to Cal Dive International for $92 million on April 7.

The deadline for qualified bids is May 27. The auction will be held June 2 and the sale hearing will be held June 8.

The sale price covers all equipment, inventory, intellectual property and other assets related to the operation of the vessels but excludes Torch's accounts receivable, overhead assets unrelated to the operation of the vessels, and claims owned by Torch's bankruptcy estate.

Regions Bank, Torch Offshore's debtor-in-possession lender, objected to the sale on April 22, saying "the mandatory bulk sale is not designed to maximize the value of the assets."

But the court over-ruled the objection.

Torch filed for reorganization under Chapter 11 on Jan. 7. The New Orleans-based offshore pipeline installation and subsea construction company's case number is 05-10137.

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