WestPoint requests approval of revised bidding procedures

By Caroline Salls

Pittsburgh, April 15 - WestPoint Stevens Inc. asked for approval of bidding procedures in connection with the sale of all of its assets, which has been modified to remove references to the stalking horse bidder and break-up fee.

WestPoint filed the motion to approve the revised auction process Friday with the U.S. Bankruptcy Court for the Southern District of New York.

The procedures also call for marketing efforts to be undertaken by Rothschild Inc.

"The debtors believe the bidding procedures provide an appropriate framework for selling the assets in a fair and uniform fashion and will enable the debtors to review, analyze and compare all bids received to determine which bid is in the best interests of the debtors' estates and creditors," according to the motion.

The motion follows rejection of the company's original auction plan by bankruptcy judge Robert Drain.

Following the ruling, Bruce Bennett, an attorney for the WL Ross & Co. LLC-led investor group looking to buy WestPoint, told Prospect News that the judge indicated he wanted to see an effort made to complete the sale under a plan of reorganization.

Subsequently WestPoint said it will still conduct an auction to find the highest or best bid for its assets.

But, after executing a definitive agreement with the preferred bidder, the company will complete the transaction through a plan of reorganization that will be voted on by creditors and then go to the bankruptcy court for confirmation.

Under the path rejected by the court, WestPoint had asked for approval of auction procedures and break-up fees for the stalking horse bidder, the investors led by WL Ross.

WestPoint Stevens announced on March 1 that it had entered into a definitive agreement to sell the company to the WL Ross investor group.

The timetable for the revised bidding procedures includes filing of the disclosure statement and bidding deadline June 10; auction June 21; purchaser selection hearing June 22; filing of amended plan and disclosure statement June 29; disclosure statement hearing July 12 and confirmation hearing Aug. 17.

The hearing on the revised bidding procedures is scheduled for April 22.

WestPoint Stevens, a West Point, Ga.-based textile firm, filed for bankruptcy on June 1, 2003. Its Chapter 11 case number is 03-13532.

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