Louisiana Pellets asset sale procedures, DIP loan extension approved

By Caroline Salls

Pittsburgh, Feb. 8 – Louisiana Pellets, Inc. received court approval of the bid procedures for the proposed sale of substantially all of its assets, according to an order filed Wednesday with the U.S. Bankruptcy Court for the Western District of Louisiana.

Specifically, the company is looking to sell all or substantially all of the property associated with a solid-waste disposal and wood biomass pellet manufacturing facility located in Urania, La.

The bid deadline is 6 p.m. ET on Feb. 24, and an auction will be held on March 2, if necessary. The sale hearing is scheduled for March 14.

Under the bid procedures, Louisiana Pellets may designate an opening bid for the auction and may agree that the opening bidder will have stalking horse status and protections, including a break-up fee and expense reimbursement in an amount not to exceed 2% of the proposed purchase price.

The bid protections would be paid to any stalking horse bidder if it is not ultimately the high bidder for the assets.

Bids at auction must be submitted in minimum increments of $500,000.

In addition, Louisiana Pellets obtained court approval to extend the maturity date for its debtor-in-possession financing to March 31.

The company said the extension will give it continued use and access to funds for operations and allow it to update the milestones governing the marketing and sale process.

Based in Urania, La., Louisiana Pellets manufactures wood pellets. The company filed for bankruptcy on Feb. 18, 2016 under Chapter 11 case number 16-80162.

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