Gavilan Resources sets bid procedures, requests July 27 auction date

By Caroline Salls

Pittsburgh, June 4 – Gavilan Resources, LLC requested court approval of the bid procedures for the proposed sale of its assets, according to a motion filed Thursday with the U.S. Bankruptcy Court for the Southern District of Texas.

The proposed bid procedures would allow Gavilan to enter a stalking horse bid agreement to serve as the baseline for the court-supervised auction process.

Bids are due by 6 p.m. ET on July 20. If a stalking horse bid is received, competing bids must at least equal the amount of that bid, plus the amount of a 3% break-up fee and up to $500,000 expense reimbursement to be paid to the stalking horse if it is not ultimately the winning bidder, plus a $100,000 overbid amount.

An auction will be held on July 27, if necessary. Bids at auction must be made in minimum increments of $100,000.

The company is requesting a July 30 sale hearing.

A hearing on approval of the bid procedures is scheduled for June 9.

Gavilan Resources is a Houston-based private company established in 2017 in partnership with Blackstone to acquire, develop and produce oil and natural gas assets in the Eagle Ford Shale play in South Texas. The company filed bankruptcy on May 15 under Chapter 11 case number 20-32656.

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