According to several sources, C&S Wholesale Grocers was the highest bidder at the auction to acquire the assets of bankrupt wholesaler AWI and its White Rose subsidiary. The auction was held Friday, October 24 at the Philadelphia office of Saul Ewing LLP, the law firm representing AWI in the Chapter 11 process. As confirmed on October 22, C&S and Eden Prairie, MN-based Supervalu were the only two authorized bidders.
The decision is pending until October 29 when a hearing on the matter (as well as other issues) will be held by U.S. Bankruptcy Judge Kevin J. Carey in Wilmington, DE.
According to our primary source, the bidding took more than 12 hours to be completed and the final price was considerably more than the $170 million that C&S bid to gain asset control and “stalking horse” status when AWI initially announced it was seeking Chapter 11 bankruptcy protection on September 9. As part of that deal, C&S also agreed to contribute an additional $18 million as part of the total $193 million debtor-in-possession (DIP) financing package granted to AWI.
In addition to naming the auction’s official winner, Judge Carey is also expected to hear arguments (and potentially rule on) requests from creditors that they should receive a carve-out in the settlement process. Related to that, dozens of suppliers are also seeking to be repaid under Section 503 (b)(9) which allows vendors to assert an administrative expense claim for the value of goods sold and delivered to, and received by, a customer in the ordinary course of business within 20 days of their customer’s bankruptcy filing.